Financial Success amidst COVID and the Holiday Season

This year has been challenging for everyone, and we are all still adjusting to living in the midst of a global pandemic. On top of that, we are now entering one of the most financially stressful times of the year: the holiday season. Many families have lost members and friends to the virus. Hundreds of thousands of individuals have also suffered a loss of income or are currently unemployed. But the human spirit is resilient, and most of us are planning to celebrate the year-end in some fashion.

Regardless of what holiday your family celebrates, there are an abundance of gifts being exchanged during the month of December and the expense of all that gift giving can sneak up on you. If you’ve been working hard to stay on budget and gain financial stability this year – in spite of all of 2020 challenges – don’t let this season derail your progress. There are three things to keep in mind from now until New Year’s to stay on course to improving your financial health.

1.  Keep your goals front and center

Typically, this time of year is filled with exciting parties, time off from work, and an incredible amount of marketing.  While the COVID-19 pandemic will have most people celebrating differently than they have in years past, temptation to spend money will still arise.  One of the best ways to stay on track with your budget is to be very firm in your goals. Think back just a few months ago, before all the holiday marketing took over your social media news feeds and televisions.  What did you want for yourself financially? Write down your goals and post them somewhere you will see them every day.  Glance at them before you go shopping. Saying them out loud every morning can have a big impact on keeping you on track.  Don’t let the pressure to spend excessive money on gifts distract you from financial success.

The holidays are about more than gifts, and they should not add financial strain to your life.  When you do make a purchase, strive to do it with cash or a debit card.  Credit cards, layaway or “buy now, pay later” programs contribute to your total debt and will prohibit you from putting extra disposable income towards your goals.  Take care of yourself by finding less expensive ways to tell people you love them.

If you struggle to set financial goals, or know your goals but need help with an action plan to achieve them, our Financial Advocates can help.  Contact them to work on your budget, debt management and wealth building goals.

2.  Building up your savings is key during a pandemic

During a pandemic, or other times of crisis, limiting your expenses and saving as much money as possible is key to maintaining your financial health.  If you were financially impacted by COVID-19, living on a crisis budget ensures you can meet your current financial obligations and keep working towards your long terms goals. However, the holidays come with distractions that hurt the likelihood of staying on budget. Even during the pandemic, you will still receive invitations to holiday parties, charity opportunities, and gift exchanges.  While gift exchanges and fundraisers clearly involve spending money, parties can also be costly if you bring a gift for the host, need gas to get there and possibly overnight accommodations. You might not be able to do everything you are invited to do and stay within budget.  Make sure you choose the events and charities that are most important to you and let go of the guilt of saying “No” to everything else.  There may be events you might not want to attend because of the financial costs or to protect yourself from COVID-19.  If you are uncomfortable telling someone you can’t attend because of your budget, tell them it’s because of social distancing instead.  This will likely be something your friends and family hear from other invited guests as well.

If you remain socially distant this holiday season, you will naturally find yourself saving money.  Besides avoiding the costs of attending parties, you will not be spending as much time browsing brick and mortar retail stores.  When shopping online, people tend to spend significantly less than in-store since they are less likely to impulse buy.  Staying home and shopping online can allow you to be very intentional in your gift spending and can leave money left over to put into savings.  However, remember to leave a holiday gift for the folks that deliver your packages, such as a gift card to a coffee shop or a travel mug. They deserve it for surviving all the deliveries they’ve had to make during the pandemic.

In addition to shopping, following social distancing guidelines will limit your visits to restaurants.  During the holidays, friends tend to gather for meals to celebrate, but this is less likely to occur during the pandemic.  This year, consider dropping a card and homemade baked goods off at your friends’ houses to let them know you care.  You could also purchase gift certificates to a local restaurant to give to friends you hope to dine out with when your budget allows and the pandemic subsides.  Gift certificates will likely cost less than a night out and also supports local establishments that may be suffering due to the pandemic. However, if you are eager to gather with friends but do not want to stress the budget, considering getting everyone together to volunteer at a local food bank, soup kitchen, or other organization in need of volunteers in your community.

3.  Gift giving can look different than last year

If you are keeping your financial goals a priority and are not attending every event, chances are you are going to do things differently than last year.  Perhaps you are not going to buy a gift for a distant cousin that you rarely see.  Maybe your children aren’t going to participate in every gift exchange they are invited to.   It is important to stay honest about how much time and money you are going to commit to the holidays.  Letting close friends and family know that you have a spending limit for gifts can alleviate a lot of pressure when comes time to exchange presents, and won’t leave you with regrets of overspending. You might consider asking your friends and family what they want as a gift.  Some people on your list might prefer cash, gift cards, or something practical (like kitchen tools).  By knowing what they truly want you are able to bring them joy even though you are spending less money than in prior years.

A key thing to remember this holiday season is that everyone had a really difficult in 2020 and there are many things we can do to spread some cheer!  Even if you are currently living on a crisis budget, you can give gifts that are incredibly meaningful and affordable.  Whenever you go to purchase a gift, try to think about supporting the local businesses in your community that have been impacted by COVID-19.  For example, you may know local artisan who knits scarves and gloves that you can buy for a few people on your list.  For those on your list who prefer gift certificates, think of local restaurants, ice cream parlors or specialty shops that could really use the business this year.  You might also think about the future of the children or other people in your life that may need a head start on saving. Opening up a savings account, even with a small starting balance, can positively impact the financial health of those around you, while keeping you on track with your financial goals.

Take control of your holiday spending this year and don’t let one month of celebrations ruin all the work you put into your financial health. Need help staying on track this December? Let one of our Financial Advocates help you every step of the way! Call us at (800) 642-2227 today.