Postholiday blues: Financial planners share tips to start now for better budgeting

Kristy Archuleta and Sonya Britt, both associate professors in the Institute of Personal Financial Planning, offer tips for starting now to ensure merrier holidays this year.

MANHATTAN — Whether holiday spending went overboard or stayed in budget, it’s time to start preparing for next December, according to financial planning faculty at Kansas State University.

“We’ve just finished all our holiday spending, so this is the perfect time to think about setting up the plan for next year,” said Kristy Archuleta, associate professor at the university’s Institute of Personal Financial Planning and director of the financial planning program. “What can we do now to be prepared for December?”

Archuleta and Sonya Britt, an associate professor and certified financial planner at the Institute of Personal Financial Planning, offer tips for starting now to ensure financially merrier holidays in 2017.

• Write a plan. Archuleta and Britt said it’s important to bang out a budget early and keep it handy — ideally in a wallet — to keep a handle on how much is being spent even while browsing among eye-catching gifts.

“Don’t be afraid to mark up that sheet of paper, because it’s a great place to keep track of what’s been spent on each person and how much is left before hitting the spending limit,” Britt said. “That way, no one is tempted to start arguments on overspending for gifts.”

Archuleta said frequently reviewing purchases and being careful to stay within the budget could help limit conflict and make holiday shopping as stress-free as possible.

• Opt in to savings. Archuleta and Britt advise opening a separate savings account for holiday purchases. Most employers are willing to send money to multiple bank accounts. Britt said making the deposits automatic is the key.

“People are not likely to start saving each month unless they make it automatic,” she said. “Once people opt in to automated savings, they usually continue because it makes savings so simple.”

This method is especially helpful when using online savings accounts because people tend to forget about them or at least find them less accessible, Britt said. Another way to keep holiday funds out of sight and out of mind is to send a percentage of the paycheck to a different bank, Archuleta said.

Create conversations. Unspoken expectations between couples and between members of extended family can brew conflict, so Archuleta and Britt said it’s important to discuss differences and any annual arrangements that have become difficult.

“If a person accuses their spouse with statements like, ‘You always spend way too much on your family,’ their spouse shuts down,” Archuleta said. “Instead, if a person says, ‘I’d like to talk about our plans for holiday spending; could we talk tomorrow after work?’ then they are setting a positive framework for how the conversation will go.”

Britt recommends having money-related conversations among relatives as well because financing the holidays becomes more challenging as a family grows. To keep the holiday spirit without the expense, Archuleta and Britt suggest a gift drawing, secret Santa, or a white elephant gift exchange. These activities can become new traditions to help everyone feel loved and come home with a gift.

“Families are usually open to do different things to accommodate people, but they may not consider making changes until someone starts the conversation,” Archuleta said. “So, a person could say, ‘I don’t know that it’s doable for everyone in our family to bring a gift for everyone, but what if we tried something new?'”

The financial planners said it is likely others are thinking the same thing, so the discussion may help everyone breathe a little easier as they envision next year’s holidays.

• Think thrifty. Holidays are a special time to celebrate, but Britt said the joy can turn to frustration when people let the season’s excitement lead them to overspend.

“Going into debt for a single day just seems ridiculous, because then people are stressing themselves out trying to pay it off for the first several months of the year,” she said. “By the time it’s paid off, some people don’t even remember what they received.”

To give affordably, Archuleta and Britt advise giving crafts made by children or writing sincere letters to loved ones. Alternatively, the financial planning pair suggest hitting the stores while postholiday prices are low. Re-gifting also is an option if it’s not returned to the original giver or presented at the same party. Also, used gifts are an option as long as they are not broken and are still fully functional, Britt said.

• Move toward meaning. The financial planners said people often spend money on gifts more than activities, but research shows people remember more strongly what they did, who they were with and the traditions they participated in than the items they received.