November 13, 2012
By John Stephan, Union Bank N.A.
Senior Vice President and Pacific Northwest Regional Executive
The holidays are upon us, and many people often feel pressure during this time of year to spend money beyond their means.
Having a plan in place may help you enjoy the festivities of the season without the worry of a post-holiday spending hangover. Following are some tips for developing a holiday budget.
Commit it to Paper
Make a list of items you normally spend money on this time of year, and don’t forget to include things like postage for cards, extra contributions you may make to charitable organizations, holiday meals, entertainment, and other items. It might be helpful to look through last year’s bank or credit card statements to get an idea of how much you spent on items the previous year. Make a list of all items, and the family and friends who will receive your gifts and assign a maximum amount to spend for each. Bring the list and budget with you when shopping and stick to your plan.
Start Saving Now
Remember that anything you finance can cost you more in the long run, so try to pay cash when possible to avoid post-holiday debt. Set up an automatic transfer or have part of your paycheck deposited into a targeted savings account that is solely for holiday spending. If you are unable to set aside part of your income toward this goal, look for ways to cut back on your regular spending or decrease your holiday budget. Consider eliminating one or two bills, such as cable TV or an unused gym membership, to help free up funds to put toward your budget.
Consider ways to earn additional cash, such as a part-time, seasonal job, or by selling homemade goods and craft items at a holiday boutique or fair. Taking on additional work here or there might help pay for some or all of the items on your holiday list.
Cut Back or Get Crafty
Now might be the time to have conversations with your close friends and family and agree to exchange gifts under a certain dollar value, or not at all. Or you could agree to cut back on holiday spending by making gifts or emailing your holiday greetings to save on postage (and cut down on paper).
Instead of exchanging gifts, you might consider organizing a group gift for someone less fortunate, or get your friends together to volunteer at a homeless shelter or other charitable organization. Spreading joy and creating memories with your loved ones could turn out to be a meaningful gift that will last a lifetime.
The foregoing article is intended to provide general information about creating a holiday budget and is not considered financial or tax advice from Union Bank. Please consult your financial or tax advisor.
John Stephan is senior vice president and Pacific Northwest regional executive for Union Bank, N.A., a full-service commercial bank providing an array of financial services to individuals, small businesses, middle-market companies, and major corporations. The bank operated 402 branches in California, Washington, Oregon, Texas, New York and Illinois, as well as two international offices, on September 30, 2012. UnionBanCal Corporation is a wholly-owned subsidiary of The Bank of Tokyo-Mitsubishi UFJ, Ltd., which is a subsidiary of Mitsubishi UFJ Financial Group, Inc. Union Bank is a proud member of the Mitsubishi UFJ Financial Group (MUFG, NYSE:MTU), one of the world’s largest financial organizations. Visit www.unionbank.com for more information.