THE CHRISTMAS SEASON is one of family gatherings and gift-giving. Most people look forward to making merry. Yet, it is a time of emotional and financial stress.
Here are 12 suggested ways of surviving the season and remaining happy about your finances. (1) Control your spending during the month. It may mean that you take more time shopping around, comparing prices and selecting gifts, but the effort is essential and worth your staying within your means. This is the best gift you can give yourself. (2) If you receive a bonus payment, do not let it dissipate into the consumption trend of the season. It is easy to overestimate what the bonus can do if you do not have a well thought-out plan.
(3) Have your bank and deposit accounts updated for interest earned, and an analysis done of any loan payments for the current year in terms of the principal and interest portions paid. For thoroughness, review your pension scheme(s); consider voluntarily contributing.
(4) Have your mortgage company provide an analysis of the current year’s payments and the projected payment in the coming year. (5) Review your financial status as at the end of the year and review your earnings and spending for the current year. How much did you earn? Did you achieve your saving/investing goals? Did you grossly under-budget some expenditure? What adjustments in budgeting are indicated for next year? The insights that this exercise provides are most valuable. (6) Assess your net worth as at December 31 of the current year. This will provide you with enormous motivation to improve the way you handle your finances. You will find yourself creating ways of balancing your spending and saving so that there is continuing growth in your net worth. (7) Review whether you have maximized your tax avoidance for the year. The less tax you pay, the more funds will be in your net worth at the end of the year. (8) Prepare a budget for the upcoming year. This budget will project all your earnings and spending. The experience of the last year and the review of what you did achieve will be very useful. (9) Review your insurance coverage – both the general insurance of your property and the insurance on your life and the lives of your dependents.
(10) Improve your cash-flow planning in the coming year by arranging certain monthly payroll deductions. (11) Remember the underprivileged and disadvantaged and extend charity. One author describes giving as a ritual of wealth. He recommends giving so that the recipient is surprised and delighted by your generosity. (12) This item is listed last, yet it is of primary importance. Never forget to give thanks, praise and worship. Many people only worship once a year, at Christmas time. It provides an opportunity, limited for some people by the infrequency of the occasion, to acknowledge the providence of God and our dependence on Him for all that we are and all He allows us to be stewards of.
May this Christmas be the best ever for you and your family, emotionally and financially. • Louise Fairsave is a personal financial management advisor providing practical advice on money and estate matters. Her advice is general in nature; readers should seek advice about their specific circumstances.
