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The big December debt detox

Christmas comes once a year, but the hole that it leaves in your bank account is the gift that keeps on taking for the next 12 months. Even though last year was economically turbulent, the Deloitte Year-End Holiday Survey 2013 reported that people still spent 8.95% more on socialising; 7.18% more on gifts and 3.7% more on food than the previous holiday season. There's no reason to suspect 2014 will buck this trend.

To avoid a December holiday budget blow-out, start planning in advance around now. Here are our top six holiday-savings tips to keep you on a debt detox' to avoid a Christmas cash crunch.

Save in advance
Even if you know you're going to get a bonus, start saving now for unforeseen holiday expenses. If you're going to take leave, your days are going to be filled with spending opportunities, never mind the costs of holiday food, accommodation and, if you celebrate Christmas, festivities and presents. Putting aside a portion of your monthly earnings is a good idea all year around, but even more so as the December holidays draw closer.

Spend in advance
If there are things that you can pay for now, then snap them up faster than you can say plan ahead. For instance, if you've booked holiday accommodation, pay the total now rather than waiting until the holidays, when you will want to spend your money on other things. Buy Christmas presents and holiday essentials like sunblock, towels, hats and swimming costumes (or ski jackets and snow socks) now rather than the week before you leave.

Set a budget
Sit down with your loved ones and take a long hard look at holiday expenses, write them down and total them up. Include accommodation, travel, daily food allowance, gifts and entertainment as well as all your usual monthly expenses like bills and insurance. Seeing a final figure can be a stark wake-up for many holidaymakers. Use that to set your daily budget and, when the time comes, don't spend it all in one go.

Treat yourself but try not to overindulge
There's a heady freedom to the December holidays, and may people feel that part of that liberation should be not worrying about money. But irresponsible spending is actually only delaying the worry until the new year. People often plunge themselves into debt over the December holidays and then spend the rest of the year playing catch-up. Remember that budget you made? Stick to it. You will thank us when you're enjoying financial freedom for the rest of the year.

Bank your bonus
If you're fortunate enough to be the recipient of a 13th cheque or bonus, it's easy to see that as free money. After a long year you deserve a little holiday splurge, but set aside some of the money to pay off debt: put some money into your bond, pay back a loan or clear your credit card.

Remember January?
Many South Africans receive their December pay cheque on the 16th of the month before everyone in the accounts department goes on holiday. This means that, bonus notwithstanding, your December salary has to last two weeks longer than any other monthly income. There are four weeks after New Year that you still have to cover, so don't go overboard while you're on leave.

The things that really matter
This list may make you feel restricted at a time when you want to enjoy yourself the most, but remember that life's real pleasures are relaxation, time spent with loved ones and the beauty of nature, all of which cost you nothing. Try to move away from consumerist festivities and appreciate the real things in life.

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