The joy of the holiday season can be overpowered with shopping stress and financial difficulties. To avoid this situation, consider this approach:
In mid-to-late November, create a spreadsheet to manage your holiday spending. Categories might include gifts for family and friends, donations to charity, holiday meals along with other items such as shipping, wrapping paper, decorations, parties, and travel.
Enter realistic amounts that you are able to spend for the various people on your gift list and for the other categories.
Monitor your actual spending, attempting to stay within your budget.
Based on this year’s experiences, adjust categories and amounts for the 2019 holiday season.
The spreadsheet might include columns for name/item, budgeted amount, actual amount, difference, and notes for future reference. Starting earlier in the year, consider setting aside holiday money to avoid taking away funds from your normal budget. You might also consider using credit card and other reward points for gifts.
For additional information on a holiday spending spreadsheet, click here.
Have students create a spreadsheet that might be used to monitor holiday spending.
Have students talk to others to obtain ideas for not overspending during the holiday season.
How would you make use of a spreadsheet for holiday spending?
Describe actions that might be taken to monitor and control holiday spending.
“Sometimes the hardest thing about saving money is just getting started.”
This Bank of America article provides a step-by-step guide for simple ways to save money–money that can then be used to pursue your financial goals. To learn more, check out the 8 steps below.
Record your expenses. Ideally, you can account for every penny you spend for the big items like mortgages, credit cards, and even small items like a coffee and snacks.
Make a budget. Once you know how you spend, you can compare your income to your expenses and make changes, if necessary.
Plan on saving money. Your budget should contain a savings category. Ideally, savings should account for 10 to 15 percent of your income.
Choose something to save for. One of the best ways to save money is to set a goal. Possible goals include saving for a vacation, the down payment for a house, retirement, or anything important to you.
Decide on your priorities. Prioritizing goals can give you a clear idea of what is most important and helps to remind you why you are saving money.
Pick the right tools. There are many saving options and the choice often depends on the amount of time before you need the money. Often, money for short-term goals is placed in savings accounts. Money for long-term goals may involve stocks, bonds, or mutual funds.
Make saving automatic. Banks offer automated transfers between checking and savings accounts. Automated transfers are great because you don’t have to make a decision to save or invest; it just happens.
Watch your savings grow. Checking your progress every month helps you stick to your personal savings plan.
Youngsters learn money management attitudes and behaviors by watching family members and others. To help guide their financial literacy development, involve children in the shopping process using these steps:
Have children help in the creation of the shopping list. Sit down together with paper or an app to list what you need. Talk through your list with your kids noting items that are low on in the household as well as things bought regularly. Have children check cabinets and refrigerator to determine things they use.
While making your list, talk about a budget. Explain the need to keep track of how much is spent on groceries so there is enough money for household expenses. Make clear that a grocery list helps make sure you don’t overspend.
Talk while shopping to explain brands you prefer and how sale prices or coupons might affect purchases. Also communicate why you choose certain stores for your shopping. As you select items explain why you’re buying that one instead of a similar item. Older children can be asked to comparison shop among different brands.
While shopping, refer back to your budget. This will help you decide to buy an item now or wait until a later time.
Provide explanations of buying choices. To avoid surprises, estimate your total before going to the cash register. Also explain different payment methods, such as a debit card, which subtracts money from your bank account right away.
Discussion of various decision-making elements will help kids learn shopping and money management skills they will need. Thinking out loud can clarify what you’re doing and why when in the store, paying bills, or shopping online.
For additional information on teaching money skills to children, go to:
Can you imagine getting paid each day that you work? That’s the idea behind Instant Financial’s app, which puts cash in the hands of workers on the same day they work. This program attempts to reduce absenteeism and employee turnover for restaurant chains.
At the end of each workday, employees may take 50 per cent of their pay for that day and transfer it to an instant account; the other half is paid at the end of the regular pay period. Funds in the Instant account may be accessed with a debit card or transferred to a bank account.
The app can reduce the use of payday loans, with exorbitant borrowing rates, as workers have access to funds between pay periods. Instant Financial makes money from fees charged employers and merchants when debit cards are used; although employees may pay ATM fees.
A major concern of the app is that it might discourage long-term financial planning. Poor budgeting habits could result in increased use of debt due to a lack of funds at the end of the month. Employees who use the app are encouraged to practice wise money management, including creating and building an emergency fund and other savings.
Many people in our society are not able to save. They are barely able to cover their monthly expenses. However, there are some actions that can help you get on a path to saving.
In the first month, open an online bank account and deposit a minimum amount, such as $5. This is a very important first step. In month two, save $15 (or more) in your online savings account. One way to do this is with Paribus, an online tool that searches various retailers to determine if you are owed money for past purchases as a result of a price drop.
Your goal for month three is to work toward savings $100. This could be accomplished by signing up with market research companies to participate in providing opinions. Or, you could try selling old items online. By consistently using various ideas for earning extra money, you should be able to save $100 a month.
For additional information on starting a savings program, click here.
Have students to talk various people to determine actions they take to reduce spending or earn extra money.
Have students create a summary presentation describing actions that might be taken to increase a person’s savings.
Describe attitudes and behaviors that might result in people not being able to save for the future.
What are actions you have taken to reduce spending and to earn extra money for savings?
“Falling gas prices have put consumers in a good mood.”
According to a survey conducted by the National Association of Convenience Stores (NACS), more than 4 in 5 Americans indicate falling gas prices impact their feelings about the nation’s economy and as a result they will spend more during the upcoming holiday season. In fact, more than one in four consumers (26 percent) expect to increase their spending during the 2015 holiday season–a 7-point jump over the past month and the highest percentage this year. Also the survey finds that women are more optimistic than men. For retailers, this statistic is even more encouraging because women do more holiday shopping when compared to men.
Dave Ramsey has taught and encouraged millions to get out of debt and to achieve an improved financial situation through his “seven baby steps,” which are: (1) establish a $1,000 emergency fund; (2) pay off debt; (3) save three to six months of expenses; (4) invest 15 percent of income in pre-tax retirement funds; (5) plan for the funding of the college education of children; (6) pay off mortgage as soon as possible; (7) build wealth and give.
An alternative perspective to this approach might be:
Create a larger initial emergency fund.
Instead of paying off the smallest debts first, pay off the ones with the highest interest.
A minimum of six months for expenses is needed, with twelve months more realistic.
Take advantage of any 401k matching offered by employers.
College may not be the right educational choice for everyone. Also, those who go to college should be responsible for a portion of education costs.
Home ownership may not be appropriate for everyone. When buying a home, paying off a mortgage may be a higher priority than saving for college to reduce the amount of interest paid.
Making money, saving money, and donating to charity should be the main focus.
For additional information on personal financial planning actions, click here.
Have students survey others regarding their use of these personal financial planning suggestions.
Have students obtain additional financial planning suggestions using online research.
What do you believe are the most important actions that should be taken regarding wise personal financial planning?
How would you communicate these financial planning actions to others?
My Wife and I Never Discussed Money Before Getting Married–and Ended Up with $52,000 of Debt
Prior to tallying up our debt, we’d talked about traveling internationally, starting a family, and, some day retiring comfortably. There was so much we wanted out of life, but . . .”
This is an excellent article that describes what can happen when a soon-to-be-married couple doesn’t talk about finances. Fortunately, the two people in this article–Deacon and Kim Hayes–realized they had a problem and then took steps to get their finances back on track.
Specific steps this couple took can make a big difference over time. Among the suggestions included in this article are:
Writing down all your assets, debts, income, and expenses.
Prepare a budget and review each item for opportunities to save money.
Replacing a newer, expensive car with an older car.
Selling unwanted or unneeded items online.
Using any extra money to repay debt.
Establishing an emergency fund.
Saving and investing a specific amount each month.
Consider This: Deacon Hayes–the author of this article–became a financial planner and now shares his story with his clients.
“Rather than making resolutions . . . try answering the following five questions today, with a plan to answer them again when 2015 comes to a close.”
In this MarketWatch article, Chuck Jaffe poses the following 5 questions to help people gauge their financial health.
What’s your net worth?
How many times your current (or last) salary do you have in retirement savings?
What’s your debt-payment burden?
If you don’t see the next New Year, what would happen to your family financially?
When reviewing your finances, what is the single thing that makes you feel the best? The worst?
In addition to the questions, Mr. Jaffe also provides information that can be used to improve a person’s answers to each question with the goal of helping people manage their personal finances and improve their financial life.
“A decision by OPEC this week to maintain current levels of oil production is hammering major energy companies in the U.S. and abroad.”
This article explores the winners and losers of lower energy prices. For consumers, lower energy and gas prices means increased discretionary funds for purchasing consumer goods including food, clothes, electronics, and presents for friends and relatives during the holiday season. Also, both large and small retailers benefit because consumers have more money to spend. And airlines, package delivery services, cruise lines, and other companies are spending less on fuel.
The disadvantages of lower energy and gasoline prices are already causing the stock prices of big oil companies including Chevron, ConocoPhillips, Exxon Mobil, Marathon Oil, and British Petroleum to decline.