Don’t Let the Holidays Leave You Broke

Canada expects Canadians to drop over $1,500 on average during the holiday season, with gifts accounting for just 41 per cent of that.

With one of the most annually influential holidays approaching quickly, now is the right time to hash out your holiday gifts game plan, personal finance experts say. Here are a few tips to help with budgeting for the expenses.

Experts suggest that a reasonable gift budget is around 1 per cent of your gross annual income. So if you make $40,000 a year then $400 would be a suitable budget for buying presents for friends and loved ones.

Scott Hannah, head of the Credit Counselling Society, told Global News that “The starting point should be what you can afford, rather than the size of your family and circle of friends.”

1. Try to only pay by cash, avoid using your credit cards as much as possible.
Nobody wants to leap into the New Year with a load of credit card debt, mainly from holiday expenses. Additionally, paying by cash means there’s no interest whereas if you pay by credit card, you will be paying more for the item than normal retail price.

2. Make gifts yourself rather than buying them. There is often a misconception that just because something has a hefty price tag on it, it will mean more to somebody & this isn’t always true. It’s the thought behind a gift that counts, try a few new ideas and make the gifts yourself, get creative! It will mean more to the person receiving it.

3. Give the gift of time. Time can be a gift that is free. In a day and age where many of us are working two jobs and constantly on our phones or computer we all should unplug and spend quality time with our loved ones. If the time together means creating an experience (I.e. a weekend away together) the money you spend on the experience can go a long way.

Happy Holidays from Splash Auto Finance!