Counting coins after living it large over the holiday period? You’re not alone. Photo: Region.
It’s the time of year when checking your bank (or credit card) balance becomes an extreme sport.
After one-too-many Christmas parties, buying presents for the family and maybe a cheeky trip away, the number on the app can induce as much adrenaline as jumping out of a plane.
It doesn’t have to be this way, and the path to a more relaxed relationship with your cash is as much about psychology as it is about budgeting.
In fact, Southern Highlands financial advisor George Root said for some people, a budget wouldn’t come into the picture at all.
“I’m a high-risk, high-reward kind of person; some people find security motivating; I need pressure,” he said.
“The solution for me isn’t to be more careful with my money, it’s to generate more income.
“I’m in a very different position to someone who is motivated by security, or who is in a fixed, predictable situation, or is approaching retirement.
“The best thing you can do is get advice from someone who specialises in your situation and your goals.”
George said for the average person who wanted to figure out how to dig their way out of a post-festive season hole, budget guru Anna Golubeva was one of the best.
A certified practising accountant, Anna spent more than a decade working with large corporations before she decided to use her skills to give back to the community.
She now works part-time in a firm and runs a financial coaching business.
Anna said the first and most important step was to identify what your challenges were and be honest with yourself about your financial situation.
“If you budget through the year but Christmas blows out you can recover pretty quickly,” she said.
“If the family is struggling and can’t save or build a buffer month-to-month that’s when you might need outside help.
“Either way the first thing to do is to face your account balance.”
Anna said if you faced your problems early you could stop them spiralling out of control.
It could also help to be honest about what’s going on in your financial life with a trusted friend, family member or a professional.
A listening ear, some creative problem solving or good advice could make all the difference.
“We should normalise talking about money the way we’ve normalised talking about our mental health,” Anna said.
“Don’t stay silent because of embarrassment. I work with clients all the time who have good careers and new cars, but they’re struggling with debt or ZipPay.
“It’s not until you talk about it with friends and family that you realise you’re in the same boat.
“Then you can come up with solutions like maybe instead of going out to dinner we all bring a plate, or maybe next year we make gifts instead of buying them.
“People think they will lose face but you can shift your perspective and change Christmas from an expensive, stressful time into a time that’s about friends and family.”
If you really feel like you’re drowning, the counsellors at the National Debt Helpline can offer free help and support.
Once you’ve faced your situation and have the support you need it’s time take a look at what you’re spending and identify what your goals are.
Anna said this was the point where knowing yourself was crucial.
“Identify any urgent bills coming in and how you will pay those,” she said.
“List your income and expenses, figure out it you have a buffer and whether you are able to save.
“If you don’t have a buffer take a good look at your expenses and think about your lifestyle.
“You need to understand what’s important to you, what you want to keep and what you can live without for a few months.
“If your morning coffee is a real highlight and someone tells you to cut that out, you’re not going to do it.
“Then you can look at a realistic time frame to pay any debts and build an emergency savings buffer.”
When the Christmas blow-out is under control, it’s time to plan ahead.
Anna said there were a few ways you could limit the damage in future.
By being super organised, you could create a dedicated Christmas fund and start paying into it now.
And you could figure out how much you spent this year and divide it by the number of pay cylces until next year. Voila, that’s how much money you should put aside from each pay.
Anna said a dedicated Christmas fund would stop you getting into trouble by dipping into emergency savings to pay for the holidays – only to be caught out by an untimely emergency.
You could spread the Christmas shopping across the year to take advantage of things like Facebook Marketplace, lay-by and end of financial year sales.
Finally, come Christmas time, you could be intentional about how you shopped.
“It’s easy to impulse buy if you walk into a shop to browse,” Anna said.
“Have a look, go home, reassess what you really need and then look online to compare prices and check for discounts.”
If that all sounded like a lot of work? You could get a financial coach.
“I compare myself to a personal trainer,” Anna said.
“You know you need to go to the gym, but are you committed enough to do it by yourself?
“It might be easier to have someone with you to give you that extra push.”
The information on this website is for general information only. It should not be taken as constituting professional advice.
