The year 2015 is gradually drawing to a close. Not too long ago we chanted ‘Happy New Year’ and ushered in 2015 full of hopes and promises. It has been a mixed bag for the country and individuals. We seem to have moved forward politically but are struggling financially. It reminds me of a popular magazine in the 80s – Sadness and Joy. A decade or so ago, Christmas would have been in the air by now. Shops and stores would have started blaring out Feliz Navidad and other Christmas songs with a festive atmosphere to go with it.
Nevertheless, we are approaching the peak shopping season of the year. Shops are getting ready with promos to draw in shoppers. Producers of chicken and turkey etc are getting ready for bumper sales. Many parents are starting to get worried about where they would get money from to spend this Christmas (clothes, gifts, parties, travel and others). Thursday November 26 is Thanksgiving Day 2015 in the United States. Friday November 27 is Black Friday, the official start of the holiday shopping season. Black Friday reached our shores with full force last year and it seems like it has come to stay, powered by online retailers and media hype. Everyone will be whipped into a shopping frenzy that will make onlookers seem out of touch with current trends.
You may go broke in January
The interesting thing is that what will happen thereafter is predictable. The prediction is not based on prophetic endowment but common sense based on the law of cause and effect, and past trends. Sales offers will flood your emails and phones via SMS and on the Internet. Santa will be in your face, literally. That thing you wished you had but was so expensive will seem doubly attractive due to reduced prices. Store owners will work on your emotions through setting the store ambience to match the mood of the season. The children will be kept occupied so that you are not in a hurry to leave the mall. Many will spend first and think later. Folks will over drink and overeat, pushing their immune system to breaking point. In the midst of the frenzy, house rent, school fees and housekeeping allowance for January will become a distant memory. Many will forget that their December salary is not meant for Christmas, but January. The party continues into New Year’s Day as we usher in 2016 which is on a Friday, carrying the momentum through the weekend.
The first working day of 2016 is Monday January 4. The night before, sobriety will descend on the land. There will be silence and contemplation as storekeepers balance their books and clink glasses. It suddenly dawns that there is school fees to be paid, the landlord will soon start knocking (if your rent falls due in January) and there is a household to run till the next pay day. Most workers complain that January is the longest month. In reality, it only has 31 days like some other months in the year. In terms of pay cycle, January is extra-long because December salaries are paid early, creating premature cash flow and the illusion that there is money to feed the holiday frenzy.
A resolution too late
By the first weekend of January, a New Year resolution would have been in place. An attempt is made to cut costs and look for where to get money to finance budget deficits. This is a dance that happens year after year – trying to close the barn door after the horse has left. If you are going to put your finances in shape, cut costs if necessary – cutting your coat according to your cloth, not your size, when is the best time to do this?
The best time to tighten your belt, if there is any belt tightening to be done is before the shopping season. Plan your expenses up to end of January as a minimum. If you have been an adult long enough, you have enough data to plan your expenses. You may not foresee every emergency, but if you have a good system in place (e.g. insurance, emergency savings, regular maintenance regime so that nothing breaks down all of a sudden etc). All your expenses from now till end of January should be in your radar. Write them down and allocate resources accordingly. If you are like most people, the money is not enough. Something has to give way or you need a financial miracle. While expecting the financial miracle, work with what you have. It will become obvious that some items are mandatory and cannot be touched. The usual candidate for cost cutting in this instance would be your holiday expenses.
The best things in life are free
Holiday gifts come and go and hardly anyone remembers what holiday gifts they received five years ago unless it was something extraordinary. Most of the ordinary things become history within the year and are long forgotten. However, few forget experiences. Having a family Christmas celebration creates memories that can last a lifetime, long after the gifts are forgotten. There are low cost things that can bring long term pleasure, including gifts. It is different for everyone. You don’t need to spend money you don’t have to please people that will not remember for long.
We need to start looking beyond our noses and learn to spot trouble from afar before it comes upon us. When you see trouble from afar, you can take evasive actions and avoid running smack into them. Everything we do has consequences, whether we realise it or not. If you approach the holiday season the same way you did last year and the year before, you will get the same results. You may get a bail out but if you keep doing the same things, you will need a bail out every year. Are you ready for the coming holiday.
Author and personal finance coach, Usiere Uko