CHRISTMAS is fast approaching.
For most of us here in the Philippines, it is the season of giving, sharing — and consequently — spending. The buying spree is already being felt, with people already stacking on their Noche Buena ingredients and for their gifts. This season, though is quite different, we are still in a pandemic and in the midst of historic inflation highs. Making ends meet, while maintaining this Spirit of Christmas has become most challenging as most of us are still reeling from the ripple effects of the Covid-19 and the Russia-Ukraine War.
Notwithstanding, Christmas will still push through — pandemic or not, inflation or not — as we relive its Spirit and spread the love that serves as our silver lining.
The season’s giving and spending, though, need not be expensive as there are ways to make Christmas memorable without making it any less meaningful. Here are six tips and strategies for a stress-free and cost-efficient holiday finance:
1. Plan ahead. Planning ahead can take a lot of time, most especially if you are a very busy person. But it is time well spent. Planning ahead your purchases and trips will make everything time- and cost-efficient. So make a list of all the items that you need to buy, the ingredients that you need to get, and your personal gift deliveries. With a list, you don’t need to go back and forth for items that could have otherwise been forgotten.
Schedule your shopping and delivery dates ahead so you will minimize going out of your home. It would be best if you will go to contiguous areas in one go to save time, effort, gas, toll, or parking fee.
Planning ahead can also mean spacing your purchases and timing them to coincide with sales and bazaars. This way, you get to buy cheaper and save money.
2. Use a spreadsheet in budgeting your gifts. The beauty of spreadsheets is that it enables you to get a snapshot and a bird’s eye view of your list, and gives you the means to automate their sum and adjust real-time as you edit it out.
List down all of the people that you would give gifts to this Christmas per category: parents, siblings, cousins, relatives, godsons, friends, neighbors, acquaintances, community members, officemates, colleagues, superiors, staff, business partners, clients, suppliers, etc.
As you list them, set a budget for each category for homogeneity and fairness. For example, P1,000 for parents, P500 for siblings, etc. There are no rules on how much you should allocate for each category, though, as that would depend on your financial capacity.
Put the budget on the column beside each person. With that, you can already auto-sum them and see the total amount that would be needed for their purchase. Compare this figure, then, to your allocation: Is it over or under? If over, then you can adjust the budget either on a per category basis, or on a per person basis; if under, you can increase on some similarly. As you do your refinements, the auto-sum feature will adjust the totals accordingly, and you can already see if it would already be within your budget.
3. Leverage your community’s businesses. Buying from your neighbors or local community makes some items cheaper and more convenient and possibly, unique. It helps small businesses; you avoid the traffic and the expenses in commuting like gas, toll and parking; and especially, you avoid large crowds — which is quite essential during this pandemic. Buying from your local community can make your gift even more special by customizing it, versus the mass-produced ones.
4. Give clutter-free gifts. Becomingminimalist.com suggests giving clutter-free gifts this season. This means less delivery expenses — gas, toll, parking and service fees — not to mention precious time and effort. You can give gift cards, e-gifts and vouchers from:
– Online shopping apps and platforms, department stores, or from merchants themselves;
– Experiences like dermas, spas, glampings or staycations;
– Streaming subscriptions like Netflix, HBO Go, Amazon Prime and Disney+;
– Activities like gyms hiking groups, climbing activities;
– Classes like swimming, cooking, baking, tennis, etc.
Giving gift cards can also mean that the receiver can buy what they need, or experience what they are into; it also means minimal physical contact, which provides lesser risk during these pandemic times.
5. Use a beneficial credit card. This may sound counterintuitive, but using credit cards can actually prove to be a wise strategy. They offer convenience and security, as you carry less cash while going around your errands, groceries, and shopping. Using them enables you to earn points that you can convert to cash or other rewards; they also give rebates which are essentially discounts on your purchases.
The trick in using these, though, is to pay it in cash: use only the card when you have the money to pay it. Otherwise, it is going into debt — and you don’t want to go that path.
6. Start building your next year’s gift fund already. If you give Christmas gifts year in and year out, then it is safe to say that next year, you most probably will … again. Given that, start saving your gift budget already starting January: divide your gift budget by 12 and then set aside that amount so that by the next December, you already have your full year’s budget built. Better, you can do bulk savings when your bonuses come within the year. Put them in a money market fund or any high-yielding savings account to make it grow even further. With this strategy, you need not charge your Christmas gift budget against a month’s salary — which can be quite significant. By spreading it throughout the year, you make it bite-sized and therefore, easier on the pocket.
Rienzie P. Biolena is a Registered Financial Planner of RFP Philippines. He is president and chief financial planner of WealthArki and Consultancy, a financial planning firm. Learn more about personal financial planning at the 99th RFP program in January 2023. To inquire, e-mail [email protected] or text to 0917-9689774
