Holiday Spending: 5 Ways to Reduce Financial Stress

Humans are creatures of habit. Our habits tend to fit nicely into our comfort zones. But sometimes, our habits actually lead to more stress and financial anxiety than comfort. With the holidays approaching, there are steps you can take to change certain patterns and build new, more supportive, and positive habits that will help put you on a path to reaching financial success.

Jane, a divorced mother of two teens, overspends on the holidays out of guilt –trying to make up for the emotional disruption in her children’s lives. She knows that come the middle of January when the credit card bill comes in, she will experience terrible anxiety.

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Peter and Marie love the holidays; they put their all into making it festive and fun. During this special time, their agreed upon yearly budget is tossed away as they feel the need to buy gifts for everyone in their large extended families. They are very conscious of disappointing their twelve nieces and nephews, six siblings, and parents. Every year, they overspend their budget. Every year, they pay the price in stress, finance charges, and post-holiday misery.

Sharon and Al have sufficient resources; spending more than usual over the holidays is not a problem. But what really makes them crazy is to see the holiday focus on “things” that are broken, discarded, devalued, or ignored once the holiday has passed. They struggle with the feeling that their money is not being well spent.

The good part about habits is that, while they are embedded in our behavior, they can be reset with intention, consideration, and specific action steps. When we take the time to evaluate whether or not our habits are indeed moving us in a positive direction, we might see patterns that we’d like to change or improve. If the following stories or similar situations feel familiar, consider taking these steps.

5 Steps to Rethink Your Habits to Reduce Holiday Stress

1. Discuss what the holidays mean to you and your family. Talk about your values and consider alternatives to unbridled spending. Make the conversation about the “why” we celebrate and what it means to us—then consider the “how’s."
2. When you are dealing with extended families, it’s important and necessary to set reasonable, manageable, and realistic boundaries. Your wallet might not be as full as others in your family, or you might be aiming your savings at retirement, saving for college or other valuable goals. Take the blame and shame out of the holidays by having the crucial and perhaps uncomfortable conversations with other family members to set expectations that are more reasonable to you. Yes, you might be moving out of your comfort zone, but that is not necessarily a bad thing. Same old same old might not work anymore, nor does it have to.
3. Instead of making the holidays a time where breaking the bank becomes the norm, make it a time to do meaningful activities that don’t revolve around spending unnecessary dollars. I know of many families who volunteer at food banks or work on projects to help others – these activities can provide deep meaning and value to your life, perhaps more so than a “thing” can. The stories these volunteers tell after the holidays are priceless, and the lessons they are providing their children have far-reaching benefits about the meaning of helping make the world a better place.
4. Create your holiday budget in January. Take advantage of the post-holiday sales for items you know you’ll need next year. For example, wrapping paper, cards and other items you buy every year can be purchased at terrific savings if you think ahead. In creating a holiday budget in January, you can divide the amount by twelve months and begin to set it aside monthly, thereby avoiding the January depression and anxiety when the credit card bills come in.
5. Focus on celebrating what is most important to you and your family. Whatever the meaning behind your holiday, put the emphasis on what you care about, not on the financial aspect of the expectations of others or the pressure applied by advertisements and promotions.

With well-defined boundaries, open and forthright communications, and a plan that you feel confident about, you can look forward to a holiday season that doesn’t end in misery. You deserve to celebrate fully and happily without the January bomb or feelings of regret. You can make new habits and enjoy the holidays by making small steps to a better and happier outcome. Wishing you all the best!