So, we know that we need to save for yearly bills. Well, we need to save for yearly expenses too.
(To those who are new here, welcome! You may be wondering what’s the difference between a Bill and an Expense? Well, a Bill is a regular and recurring debit or withdrawal from your budget, such as an electric bill or phone bill. An Expense is everything that you pay for that isn’t covered regular and recurring, such as food or entertainment or gas. More here.)
Holidays can be somewhere in between a bill and an expense. But by whatever bucket you put the expenditure in, you still need to factor it into your budget somewhere.
Actually, some celebrate it in January
I once heard some wag say, in response to how Christmas can sometimes sneak up on people: “Christmas is always in December. They don’t move it.”
Indeed, it does tend to stay on December 25th from year to year. And yet, it sometimes seems that we only start thinking about Christmas when the ads for Black Friday (and the associated cultural hand-wringing) start popping up in the news.
But the best time to start planning for Christmas spending, or indeed any December gift-giving holiday, is in January. And ahem, that’s the January before.
It works just like any other yearly expense: if you plan to spend $300 on gifts, that’s $25 a month that needs to go in the pot. I don’t know about you, but a $300 extra expense is not something I can easily absorb in a given month, so I’d need to plan it out in advance.
Remember the objective: You want to pay with money. This means not using credit cards, where you haven’t actually paid for anything at all (yet).
More than money
This type of planning extends to other aspects of holidays other than finances too.
- Halloween tends to be on October 31st about 100% of the time, so if you want to put together a costume, it shouldn’t come as a shock to you on October 30th to realize you need to do this.
- Did you know that many people travel for the holidays? It’s true! So figure out what you’re doing as far in advance as possible, lest you buy a $1000 plane ticket that you could have had for half that.
- If I’m doing something for someone’s birthday, I tend to start to think about it at least a few months in advance. Now, part of this is my own personal anxiety/comfort level, but it’s also so I don’t get to the week before and then panic when I find out that my options are limited.
Not that I always exhibit a stellar track record in all of these realms. This year my Halloween costume consisted of rabbit ears borrowed from a friend on the way to the Halloween party. But it worked as well as it needed to, in this case.
Now, I’m a fan of repurposing holidays, and don’t typically do much in the month of December. But many people I know are very into the ritual of gift-giving around this time, and it’s not my place to criticize them for what can be a very kind and wonderful gesture. Especially when it doesn’t involve fist fights in the parking lot of major retailers, or retail stampedes.
But regardless of your intent, you’ll have a better time, and reduce your stress level, if you plan your holidays in advance. Especially the ones that don’t move around on you.
But enough about me. Do you ever let holidays sneak up on you?
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