Pastor Louise recently ran a CAP Money Course here at AC and so we asked her to give us some tips on managing our finances this during the holiday season.
I have the privilege of being a Money Coach, helping people build skills to have a lasting impact on their finances. The CAP (Christians Against Poverty) Money Course teaches three basic principles:
- How to build and live on a budget.
- The CAP Money system, that divides your money into three accounts (regular payments, savings and cash), simplifying how you track your finances, and
- How to live week to week using cash instead of cards.
Using these principles, people can learn how to meet their financial obligations and be able to save for special occasions and events, such as Christmas or family vacations.
As the Christmas season approaches, we desire to be able to gather with loved ones, making precious memories and giving gifts. Giving gifts often means spending money, and for some, it means waking up in January to credit card bills and debt that become difficult to pay. It does not have to be that way! You can reduce your holiday stress by creating and following a holiday budget and spending plan.
Here are some suggestions to help you:
- Begin with a List of Holiday Expenses: Make a list of all your expected Christmas expenses, including: gifts, wrapping paper, cards, postage, travel expenses, special food, office parties, charitable donations and all related incidentals.
- Decide on Your Spending Limit: Determine what resources (financial and otherwise) you have available to use. Use only money you have already set aside or extra money you can find in your budget. For example, if there are 80 days left until Christmas, perhaps you could determine to set aside $5-$10 per day to be able to have $400-$800 available for Christmas spending.
- Assign Money to Each Category: Divide your spending limit among the various things you will need to buy: food, gifts, clothes, entertainment.
- Make a Shopping List: For each item or individual on your list, have two or three gift ideas that fit within the price range you are willing to spend. Begin to watch for major sales, such as Black Friday and store specials, to enable you to find some great gifts for less money than you expected.
- Track Your Purchases: Document what you spend, keeping track of what you actually spend. Take your gift list and budget sheet with you when you shop to keep you on track and avoid distractions. By tracking your spending this year, it will help you know what to start setting aside monthly in January next year to reduce your stress about holiday spending when the time comes again.
- Stick to a Cash-Only System for Purchases: It is a fact that people overspend when using a credit card. When shopping in person in stores, using cash helps you to stay within your spending limit (if you don’t have it, you can’t spend it!). Shopping online can help you comparison shop to find good deals, but you may have to use a debit or credit card to do this. If so, make sure you have the funds available to immediately transfer the money from your account to your credit card and not go into debt.
If you find that you need extra money to cover your holiday spending, you may consider taking on a part-time holiday job, or finding other ways to increase your income on a short-term basis to help with your budget. Or you may consider sharing personal, homemade gifts, such as baking or crafts, which may not cost a lot, but show the time, love and devotion that you gave in considering a special person.
Finally, we need to remember the real meaning of Christmas. When all our seasonal celebrations and gifts have passed, God’s greatest gift of love, found in the birth, life, death and resurrection of His Son, Jesus Christ remains forever. Some may not be able to buy material gifts this season for various reasons. Being present with loved ones, and those who may be alone, sharing a meal or time together, creating special memories may be the best gift we can give or receive. Plan for the upcoming season carefully, avoid overspending and going into debt, reduce your stress, and allow the light of Christ to shine brightly through your heart to those around you!