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Smart ways to beat ‘Njaanuary’ woes

Money can easily become the focus of the holidays when it should be the last thing you are thinking about. “By keeping the spending under control, one can have a great holiday and avoid the sick feeling in the pit of the stomach that occurs when those January credit card bills start coming in. If you prepare properly, you can achieve a happy balance of spending and saving during this holiday season. Below are tips on things to help you avoid ‘Njaanuary’ blues according to business mogul Chris Kirubi, Business Insider, Financial Post and PricewaterhouseCoopers 2015 Holiday Outlook report.

1. Set Limits

The first thing one should do is to set limits and stick to them. If the plan is to spend on making people happy by showering them with gifts, have a budget that takes cognisance of your overall earning per month.

If it exceeds or takes up three quarters of your salary, then it is not worth it. If you have a set budget for gifts, force yourself to find gifts that fit within budget, have some discipline because you will need it in your planning. Experts state that if one plans to spend comfortably during the festive season, planning should start in January. At this moment, it is recommended not to do some impulsive thinking.

2. Budget

Write down a list of things to buy, also jot down a list of must-attend-to budgetary obligations come January. Try and balance the two but pay sufficient attention to priority issues such as school fees, rent, a new business among others, leaving out a possible trip to the Coast, a driving spree around the East African countries and classified expenditures.

PwC 2015 Holiday Outlook report states that discounts are most important to shoppers with less household incomes a year while those with more incomes have a more distinctive brand appetite.

However, despite the brand appetite, it is advisable to go for discounts if you must shop. Try and weigh the December and January planned expenditure and see what comes first in your list of priorities.

3. Meaningful gifts don’t necessarily have big price tag

It might be nice to give your mum a brand new TV, but there are other things out there that will be even more meaningful and enjoyable for her. If looking to give a gift that truly means something and that will keep its value for years to come, it is better off looking for non-material gifts to give than for something they could get themselves at the local big box store.

4. Watch out for deals that seem too good to be true

Retailers and websites run all sort of specials to induce consumers to buy now, and the holidays offer these companies easy prey in the form of deal-seeking, cash-strapped consumers. For example, furniture stores frequently offer that if you buy now, you don’t have to pay a thing for a year and you might even get free delivery.

This sort of “push” marketing can make it harder for one to say no. Always remember that free financing for, say, a year is not a huge cost to the dealer, but it is a cost, and if forgone, one should be able to negotiate a lower purchase price.

Retailers find that buyers are less likely to negotiate the price if they are getting a short-term financing break. Read the fine print on any deal you are considering taking before going to the store to make the purchase.

5. Find an alternative to gift-giving during the holidays

Many people feel they have to give gifts during the holidays, either because it is a family tradition or because they know their friends and relatives have acquired gifts for them. There are plenty of great ways to trade in this tradition for another one that is even more meaningful. Instead of exchanging gifts, family members might want to pool their money and spend it on a holiday outing.

6. Plan what you are going to buy

Particularly during the holidays, companies pull out their most appealing packaging in hopes of snagging the eyes of shoppers. That is why along with the budget, take an exact list of what you want to buy for your gift recipients.

Do not go shopping for someone’s gift until you know exactly what you are going to buy. It is very easy to go in with no plan, see something you like, and get it simply because there is no idea of what else to get for a hard-to-buy-for relative despite the gift’s significant price tag.

7. Planning for trips

This is the time to take a break, mostly with loved ones. While some travel to their rural homes or visit relatives and friends in other towns, others opt for holiday destinations. It is already evident that Kenyans have been planning for their trips, owing to the surge of bookings at the Standard Gauge Railway. To book the train, one has to now book a day or two earlier.

This is commendable as last-minute preparations cost a lot of cash as prices for most commodities have gone up. To save for January: on travelling destinations, accommodation should be organised in such a way that the family is within the same suite.

8. Pay Rent Early

It is not uncommon for tenants to pay rent late in January or try to make payment arrangements during this time of year. During the holiday season, most people do everything they can to pull together a little extra money to purchase presents for loved ones, prepare a delicious feast or treat themselves to one of many holiday concerts and events.

Other seasonal issues that may cause someone to spend more than they mean to, include a car accident, illness or injury, maternity leave or seasonal layoffs. When budgets are stretched tight, some tenants may feel like they can push the rent a little and hope that a generous landlord will look the other way or not be as strict due to the season.

9. Avoid quick cash loans and Loan sharks

After getting hit hard financially by the festive season, taking out an emergency fast-cash loan can seem the perfect short-term solution to January money worries. These are to be avoided at all costs as loans like this have sky-high interest rates and hidden charges. Instead of solving January blues, this will be brewing even more trouble come February when repayments are due.

10. Do not spend more than you earn

Most people make the mistake of spending money they do not have. There is no point in trying to keep up a lifestyle one cannot afford by borrowing money to spend on things that will not provide income.

This pushes one to borrow from friends and family members. December holidays are a good recipe for borrowing from one friend to pay another and if the year starts on such a note, it will be a year full of credits that can only be fully settled in the mid-months. You will be better off in January if you do not have any pending debts to pay.

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