Following a season marked by celebrations and spending sprees, it's time to crunch the numbers. Here are five tips on how to successfully get through the dreaded post-holiday budget crunch.
The start of a new year is usually a time for resolutions. Aside from the more common ones - to maintain a healthier lifestyle or to read more books - there are also financial resolutions. A few common examples are to save more, to manage your money better or make wiser investments. However, due to a variety of factors that come up in after the holiday season, it can be difficult to meet your financial objectives in the short-term because of the post-holiday budget crunch.
The expression "tighten your belt" is often used to make changes in order to save money. In January it is related with the post-holiday budget crunch. The phrase comes from the fact that when you don't have enough to eat, or you want to live more frugal, you have to tighten your belt. The reasons behind the post-holiday budget crunch: first, due to increased prices in certain public services with regulated fares, such as public transportation. In these cases, cost adjustments are made in line with the CPI (Consumer Price Index).
Second, due to the money spent in households – which is often excessive – during the Christmas and New Year Holidays. During this time, many people find themselves spending more money than usual. This means they save less and some people end up in more debt, which is generally reflected in the expenses they face in January.
How to manage the belt-tightening period
Proper financial planning can help prevent any economic difficulties after the Holidays. Here are some tips that you can put into practice:
In addition to following these tips, any other measures you take to manage your personal finances will have a positive effect. Keep in mind that every small action will make a difference when it comes to reducing the effects of the post-holiday budget crunch.