Unless you’re among a select group of people, sitting down and creating a budget is not much holiday fun. The Better Business Bureau recommends that mapping out your spending in November, however, will help ease the strain of a financial holiday hangover in January.
In fact, creating a budget, and being disciplined enough to follow it, is one of the best ways to avoid overspending during the holidays. The BBB offers five steps:
Step One: Add up your monthly salary along with your spouse’s and any child support payments, dividends or interest payments and other sources of income.
Step Two: Add up regular monthly expenses. Start with your rent or mortgage, utilities and credit card payments. Factor in other expenses for gas and car maintenance, health care and groceries.
Step Three: Estimate holiday expenses. Make an itemized list of gifts for family, friends and coworkers including what you’re willing to spend for each person. What will you spend on entertainment, both at home and at movies and restaurants? Will you need to purchase new decorations? Or will last year’s make do? Will you be traveling for the holidays? If so, consider the cost of gas, airline tickets and even pet boarding. And don’t forget to include donations to charitable causes.
Step Four: Revisit, evaluate and revise your budget along the way. Once you’ve added up your income and your expenses, it’s time to compare. If more is going out than coming in, it’s time to go back over your budget and pare down expenses. Consider giving fewer gifts or less expensive ways of entertaining. Last year’s decorations are also probably just fine. Once you’ve balanced your budget, revisit it frequently during the holidays to make sure you’re sticking to it. You might find that you over estimated in some categories and underestimated in others.
Step Five: Reward yourself. Plan for a small reward that you can earn if you meet your goals. If you don’t meet your goals, you can guess where that money is going instead: Paying off your credit card bill in January.
Start With Trust. For more holiday consumer tips and information, visit wynco.bbb.org/consumer-tips-holiday/ or call 970-484-1348 or 800-564-0371 for reliable consumer tips and information. Don’t go a day without your BBB. Follow us on Twitter, Facebook, LinkedIn, and Flickr.
About the BBB
The Better Business Bureau, founded in 1912, is a champion for ethics and trust in the marketplace. Only businesses that meet the high BBB standards are invited to become BBB Accredited Businesses. Today, 123 BBBs across the United States and Canada rate more than 4 million local and national businesses and charities with scores ranging from A+ to F. Only a BBB Accredited Business may elect to participate in BBBOnLine, one of the most trusted and recognized Internet seal programs in the world.
The BBB serving northern Colorado and Wyoming topped 1.1 million instances of service to consumers and businesses in the last 12 months. These services include reliability reports on local companies and charities, access to companies that can be trusted by industry, help with dispute resolution, and trustworthy information on consumer and business topics.
Luanne Kadlub, BBB media relations manager, 970-488-2044 lkadlub@wynco.bbb.org