Let Your Checking Account and Savings Account Help With Holiday Spending
So many aspects of life work out for the better when you give yourself enough time. If only we could all plan to leave the house just five minutes earlier than we normally do, driving to our destinations would be far less stressful. The same goes for holiday budgeting. You can achieve more over a longer period of time than suddenly realizing at the last minute that it’s time to pinch pennies so you can afford gifts or a special celebration.
If you’re thinking about making your holidays extra special, starting your budgeting journey now will bring you the best results. Keep reading to learn five easy steps to budget for the holidays, so you can bring joy to family and friends without financial stress.
1. Start With a Target In Mind
The first step toward budgeting for the holidays is to set a goal. What kind of cash do you want to have on hand for this time of year? Answering these questions will help:
- How much money do you plan to spend on presents for family, friends, neighbors, or colleagues?
- Will you send out holiday cards? Be sure to include fees for personalized photo cards and postage.
- Are there any big-ticket items on your family’s wish list this year?
- Do you plan to host any parties or gatherings?
- Are you traveling at all, staying in hotels, or going to any events?
- What other traditions also cost money each year (like holiday lighting, wrapping paper, or donations to
- charity)?
After you’ve answered these questions, you can determine what you can expect to spend. Consider whether you think that total is reasonable and trim or add as needed. Now you have a goal that you can stick to. The next step is to figure out how to meet that goal.
2. Figure Out Your Expenses (And Get Savings and Checking Accounts If You Don’t Have Them Yet!)
Calculating your monthly expenses lets you know how much cash you have on hand at the end of the month, after you’ve spent money on necessities. Tally up your essential bills to see where you stand. If you have bank accounts, one of the easiest ways to do this is by going through the bank statement for your checking account from your bank. You can easily total all your expenditures paid for by your debit card because, these days, most of us use our cards for daily transactions now.
Pro Tip: If you don’t have a debit card, many local banks offer free online checking accounts in Kansas City, Brookfield, Eagleville, Kearney, and Milan. Open this account, and you can monitor your expenses for one month, and start your budget immediately after.
After you’ve totaled everything up, how much cash do you have on hand after expenses? That will tell you how much you could save over the next few months, if you only focused on the basics. Don’t forget these common expenses:
- Mortgage or rent
- Payments on all vehicles, including your daily driver, UTVs, and RVs
- Gas, electric, water, and trash bills
- Internet and cable bills
- Fuel for your vehicle(s)
- Childcare and extra-curricular activities
- Insurance premiums
- Pet care
- Groceries
- Health and medical expenses
- Clothing
3. Consider Whether You Can Meet Your Goals
Consider the cash you have on hand at the end of the month. Can you achieve your holiday budget if you save that same amount each month? Where can you trim? Consider cutting expenses in certain areas where money could be best allocated to savings. U.S. News and World Report points to several areas where consumers spend too much, including:
- Streaming and subscription services
- Tech bills, like data storage for your phone
- Food and grocery delivery services
- Memberships that you rarely use
- Take out and restaurants
- Items that you consistently buy at full price, but are cheaper elsewhere
After you’ve made necessary trims to your budget, do you have enough money to meet your goal?
- If you do have enough, follow this piece of advice: Expect the unexpected between now and the holidays. You may decide there are necessary purchases between now and then that aren’t in your budget. You will also want to set aside money for fun in the meantime, like treats and entertainment, too, so you aren’t a miserable Scrooge while saving up.
- If you don’t have enough, readjust your holiday budget as needed. Begin by prioritizing the essentials, such as a child’s special gift, while cutting others like gifts for neighbors that could easily be handmade or baked instead of purchased at the store.
4. Don’t Just Start Budgeting Now, Start Buying Now
Creating a budget for the holidays assumes that by the time the holidays come you will have saved enough money to meet your needs. Although we typically purchase for the holidays all at once, you can put less strain on your budget and make the holiday shopping frenzy easier by purchasing items between now and the start of the season. Because you’ve created a budget and used your free online checking account to determine your monthly expenses, you can think of shopping for the holidays as a month-to-month expenditure. Your spending calendar may look like this example:
- August: Buy all cards, wrapping paper, and plane tickets.
- September: Order the family’s big-ticket gifts.
- October: Buy specialty holiday food items for the freezer.
- November: Purchase the tree lights and items that will be on sale for Black Friday and Cyber Monday, like tech.
- December: Focus on smaller gifts and unexpected holiday needs.
You may also be able to get better deals on certain products outside of the holiday season. Many items purchased outside the holiday window of October, November, and December are far less expensive.
5. Consider Next Year’s Approach With a Checking Account and Other Services From Your Local Bank
After you’ve given the first four steps a try, you have an entire year to reconsider your process. Will you start earlier in the year? Where will you cut back? Where did you cut back that you’ll add back in for the new year? If you pay close attention to your checking account this time around, next year will be the year that you seek out an online, free checking account. You’ll be able to budget even more effectively by keeping a digital trail of all your transactions, including deposits and withdrawals. Your local bank likely offers more than just a free checking account for Kansas City, Brookfield, Eagleville, Kearney, and Milan customers.
Spend time thinking how a personal loan, home equity line of credit, or a CD could help you access the money you need. Or, if you meet minimum deposit and balance requirements, you could potentially open an interest-bearing checking or a savings account to see your money grow throughout the year, so you have more to spend during the most wonderful time of the year.