With the holiday season now in the rearview mirror and credit card statements starting to arrive, your finances may be feeling a little stretched. Between splurging on thoughtful gifts, festive apparel, and hosting memorable family meals, it’s easy to overspend during the holidays. The good news? By adopting a few simple money habits, you can ease the post-holiday squeeze and reduce the chances of facing the same situation next year.
Can creating a budget (or recommitting to one) help curb overspending?
A new year offers the ideal opportunity to reset your spending habits by establishing—or revisiting—a budget. Budgeting helps you better understand where your money is going, making it easier to stay within your means. If you’re new to budgeting, start small with a basic worksheet to track your income and expenses. Already have a budget? Take time to review it alongside last year’s bank statements to see how closely you followed your plan. If things didn’t go exactly as intended, that’s okay. Adjust your 2022 budget to reflect current expenses and updated savings goals. If you need guidance, a financial advisor at your local credit union can help you build a plan tailored to your needs.
Why is it important to set financial goals?
Setting yearly financial goals can play a big role in recovering from holiday spending while supporting your overall financial and mental wellbeing. Whether you’re saving for a new vehicle or dreaming of a well-earned getaway, defining short- and long-term goals helps clarify how you want to use your money. With clear goals in mind, you’re more likely to spend intentionally and save consistently. Consider taking on the “52-week money challenge” to kick-start your savings. For extra motivation, invite friends or family to join you and turn saving into a shared commitment for 2022.
Can switching how you pay help control spending?
From daily coffee runs to big-ticket holiday purchases, credit cards have become the default payment method for many Canadians. Unfortunately, that convenience can lead to unexpected debt in the new year. In 2022, try using your debit card more often. Watching money leave your account in real time can encourage more mindful spending and help you focus on paying down existing balances. If you continue to use a credit card for rewards or other benefits, aim to pay it off in full each month. Your local credit union can help you explore affordable credit card options that align with your financial goals.
When should you start planning for next year’s holidays?
Picture heading into the next holiday season feeling confident and prepared. Planning ahead is key to enjoying a stress-free, debt-free celebration. January and February are ideal months for Canadians to review past holiday spending and begin preparing for the next one. By setting aside a small amount each month in a dedicated holiday savings account, you can spread out the cost and avoid last-minute financial strain. Talk to your local credit union about opening a holiday savings account and start building toward a more relaxed and joyful season next year.
Take control of your financial future—become a credit union member
ABCU offers practical support to help you create realistic budgets and manage your money throughout the year. Not a member yet? Contact us and take the first step toward a healthier financial future today. general@abcu.ca
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