We have discussed how research has found that there is more happiness to be found in experiences than in buying objects. However, there is a temptation to overspend even when following the best financial advice. You may think that if you focus on experiences with your family and friends (as opposed to just buying a lot of gifts to hand out) that you are doing the best thing for your wallet but if you overspend, that may create difficulties for you.
If you and your family decide to travel this holiday season instead of staying home and exchanging gifts, you will need to budget for a holiday trip as you would for any other. Especially since vacations lend themselves to the temptation to indulge and a holiday trip may lead to even more indulgence.
Staying home doesn’t keep you from temptation either. The desire to have a wonderful spread for family and guests to eat or to make sure your home is beautifully decorated may lead you to overspend.
And while many of us may need to rein in our generosity towards others, in “Why you should plan ahead for holiday spending,” Forbes points out that “Nearly a quarter of adults say they usually buy themselves gifts over the holidays.” The temptation to pick up something to treat yourself while you are doing so much work to make the holidays great for everyone else is strong so you should set a limit for spending on yourself. This is not to say you don’t deserve a treat; but too many of those “treats” can hurt later when funds are low.
If you are someone who feels overburdened with holiday shopping and planning, take a step back and consider what you can do differently. When you are footing the bill or doing all the work for family trips or dinners, ask yourself how others can contribute. Can you provide entrees and ask others to bring side dishes? If you are being asked to pay to take more people than you can afford on a trip or to an event, consider your own financial needs before you overextend yourself.