5 Ways Cash-Strapped Renters Can Budget for the Holidays
Part 1: Plan Ahead
As December approaches, many renters brace themselves for a flood of additional expenses, including higher utility bills, lease renewal increases, and – of course – the holidays! If money is on your mind this Christmas or Hanukah, don’t despair! In our two-part series on budgeting for the holidays, we’ll look at five ways cash-strapped renters can manage spending and still enjoy the season.
As the winter celebrations begin, it can be easy to get caught up in a whirlwind of parties and gift giving. The temperature drops and the scarves come out, and all of the sudden we find ourselves digging into our wallets and spending more than we ever imagined!
But keeping an eye on your finances doesn’t have to dampen the festivities. Here are some easy ways to stay in the black this yuletide.
Make a List and Check It Twice
The best way to make sure you’re not acting on impulse and doling out dollars you don’t have is to write out all your expected expenditures over the next few months. When it comes to gifts, make sure to include all the trimmings like cards, wrapping paper and shipping. If you’re not careful, it could end up costing you more than the gift is worth just to send it!
Split your list into “must give” and “maybe” so that you can prioritize gift purchases. You don’t want to end up giving your mom a homemade macaroni frame because you dropped $50 on a gift for Great Aunt Edna. If you are attending a party or potluck, be mindful that you may need to bring a hostess gift or food item. Map it all out now and avoid costly surprises later on.
It’s equally important to take note of all those bills and payments due in January, including annual fees, membership dues, insurance renewals, etc. One way to do this is to add yourself to the gift list and include whatever you might have to pay out in the coming year. Who knows, maybe you’ll even find a way to splurge on something nice for yourself as a reward for being so responsible!
Don’t Abuse Credit Cards
In a perfect, Beaver-Cleaver world, we’d all start saving at the beginning of the year and greet December with a healthy nest egg and a huge smile for a job well done. Unfortunately, many of us live paycheck-to-paycheck and even the most conscientious saver can get sideswiped by a sudden emergency like car repairs or doctor visits.
Even if you’ve failed to put aside funds, resorting to credit cards you be your last resort. If you can, pay for everything in cash. When you’re slapping down a twenty on the counter, the visual reminder of hard-earned currency leaving your account will make you less likely to act impulsively. Credit cards make it too easy to feel like you have unlimited funds. Come January, you’ll have an interest rate hangover when you see how much extra you end up paying for the convenience of just signing on the dotted line.
If you must use credit cards, be smart and be picky. Choose a card with a small credit limit and low-interest rate. As you buy items, add ten percent in your head so that you won’t be completely shocked when those statements roll in. Make a plan in December for how you’re going to pay off your cards in the coming year. A payback plan can help keep you from going overboard and help and reduce any anxiety you might feel about necessary outlays.