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It’s that time of year when everything tastes like pumpkin spice, all of the stores have Christmas decorations up and your inbox is getting inundated with pre-Black Friday offers.  Before you can remember when the Dallas Cowboys last won a Superbowl, you will be sitting down for Thanksgiving turkeys and going gonzo over Christmas dinners and eggnog.

That’s right – it must be November.

And with the leaves changing, we thought, why not follow suit?

Do you remember all those annual resolutions you made eleven months ago?  How have those gone?  Hopefully, you have accomplished most and maybe added a few as the year went along.

The next sixty plus days can destroy the success you have built with your financial plan in the twinkle of Santa’s eye.

Here are Five Steps to Say NO to Excess Holiday Spending.

Step 1 – SET A BUDGET

This is not an “I think this is what I will spend budget”.  Block out an hour THIS WEEKEND, sit down — with your significant other if you share the bills — and write down your holiday budget. To do this, you need to:

  • Brainstorm every gift you need to buy. A common mistake is leaving out all of the little gifts that can add up. They include the “white elephant” gift for the family party, gifts your bosses, colleagues, customers and clients, the “Secret Santa” exchange at the office party, and all those special tips for your service providers.
  • Write down all holiday food expenses. Your normal grocery budget isn’t likely to include things like the fixings for a family feast or ingredients for dozens of cookies.
  • Assign a dollar amount to every line item. Every person and event needs a specific budgeted amount.  BE SPECIFIC

Once you add it all up, decide if you can afford it. If not, eliminate some spending.

Step 2 – Inventory what you already have

Tina has a gift closet.  This is where those gifts accumulate over the year when we see something that will make the “perfect” Christmas gift.  On more than one occasion, we have discovered a gift still in the gift closet after Christmas.

Inventory what you have and put it on your list.

Step 3- Plan your shopping

Start NOW – those last-minute gifts are where you can blow the budget because they become impulse spending.

Share the responsibility of buying gifts throughout the entire family.  Shopping, unfortunately, has turned into an open the browser, shop, click and buy experience.  Embrace the old-fashioned shopping trip together.

When possible, I encourage you to shop local.  Support our neighbors.

Step 4 – Track What you spend

As a CPA and a Financial Advisor, it won’t surprise you that I use a shared excel sheet with Tina to track what we spend for each person.  Yes, its in the cloud and I can access it on my phone.  Pen and paper works and there are numerous apps that you can use such as:

Step 5 – STOP SPENDING

This may be the most important step of all.

Once you have crossed them off the list, it is time to stop.

This will give you a sense of accomplishment and when we get together to review your December 31, 2019 Net Worth statement and make plans for 2020, there won’t be the lingering shopping remorse from overspending.

Have a great fall weekend.

Michael Tannery

Michael@tannerycompany.com

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