MONEY DIARIES: navigate the festive season
How to stay solvent through the silly season
The word ‘frugal’ has a bad reputation, often perceived to be synonymous with the word ‘stingy’. To be frugal is to be financially cautious and to intentionally maximise the mileage of your money, whereas to be stingy is to always go for the cheapest option to save a buck, often for no reason. Essentially, stingy is ‘frugal’s’ notorious relative who always tarnishes the family name. This festive season, we’re restoring ‘frugal’s’ dignity by using it to guide us in stretching our bank balance through December and into January, starting on the premise that it sometimes pays a lot more to spend a little less. Here’s how:
You may not break the bank each time you buy a drink or a meal, but the costs are cumulative. Mitigate these by buying your groceries in bulk at wholesalers. This will help you spend the lion’s share of your earnings on experiences and negligible amounts on food. TIP: It may work out even better for you and a group of friends to pool your resources and buy in bulk. You can then split the costs and distribute the goods at an at-home party, with whoever’s hosting it getting a discount.
Do as many things ahead of time as possible. You can make many little savings this way, which amount to big savings by simply being proactive. Take advantage of lower prices for pre-ordered tickets for shows, rather than buying them at the door. Have pre-dinner drinks at home, to avoid spending exuberant amounts at restaurant bars. You could even have a home pre-main course and only order starters, dessert and coffee at the restaurant.
Cash in on the often under-used blessings that are two-for-one or halfprice specials. Luckily, the Internet abounds with discount platforms, such as Livingsocial, Deal Africa and OneDayOnly.
FACTOR SPONTANEITY INTO YOUR BUDGET
It’s fair to anticipate unplanned nights out or having to chip in for an unexpected family event at some point over the holiday period, so draw up a budget for these impromptu occasions. ‘The main issue is that many people tend to spend what they don’t have during the festive period,’ says Nolwazi Khumalo, private banking team leader at Investec. This can be controlled by setting boundaries for unexpected expenses. These keep your finances under control and prevent reckless spending.
‘NO’ IS A FULL SENTENCE
Saying ‘no’ is one of the hardest things to do when you’re tempted to indulge in something you can’t afford or that will set you back severely. The holiday period isn’t open season for incurring mindless debt. ‘Credit cards and overdrafts aren’t free money: you have to pay them back – with hefty interest,’ says Khumalo.
LET THE GHOST OF JANUARY HAUNT YOU
You’re in a good mood, your salary probably came along early and you feel flush. Your cash flow may look good right now, but remember that this is a long-term game. When January’s shadow lurks, pay attention to it, because it will save you a great deal in the long run. You have the makings of a frugal mastermind. Now go out and enjoy – responsibly.