For many of us, the New Year brings a new start. New opportunities, new excitement, a clean slate. However, it can also be a continuation of the money worries you had last year. Christmas has only just happened, but that earlier-than-usual monthly salary payment can make January even harder. There is even longer between paydays and we’ve spent more than we wanted. How can we fix a January financial hangover? Let’s take a look and figure this out.
Understand How This Has Happened
Firstly, when working your way through a January financial hangover, you need to understand how this has happened. It is so easy to see Christmas as a time of indulgence, and it should be! However, that indulgence needs to be within your means. Within the confinements of the money that you have. Not overspending and buying gifts you simply cannot afford. Yes, there might be the latest and greatest gadget advertised on the TV and you might have had a sneaky peak at your child’s Christmas gift list, however, children don’t want their parents with added stress. Many of them actually want time for Christmas. Time with their loved ones spent together making memories. Plastic gizmos shouldn’t be put above this completely free desire. See that you are spending more than you are making and then realise that this has to change. Otherwise, you will have a January financial hangover every year.
Keep An Eye On The Date
Counting down to the next paycheque might not seem like much fun, but knowing exactly how much time you have to play with will help. It will allow you to budget the money you do have, or figure out how long you need to be in your overdraft. If you still have 28 days before your next paycheque, that is four weeks. That’s four weeks of putting food on the table and packed lunches when the kids go back to school. When do your energy bills come out of your account? What about your mortgage or rent? Figure out the number of days until that next pay cheque lands in your account and organise your January finances so you can survive this time period.
Pay Off Your Highest Interest Debts First
If you have overspent and owe money, be sure to pay off those debts with the highest interest first. Interest gets added every day so if you clear those debts with the highest interest, the amount you owe won’t grow quite as quickly. You need to make the money you owe as manageable as possible. This means clearing the debts that are growing the most and getting on top of things.
Change Your Money Habits
The stats say that those who get into debt over Christmas take an average of four months to get their finances back on track. That is an average. For every person who takes one month, there will be people who take six or seven. Do you still want to be clearing Christmas debt in the summer? It is time to change your money habits. When you have a good handle on your money, you can make it work for you. Save throughout the year for Christmas so you have the money in place rather than having to borrow it. Keep a closer eye on what you are spending at Christmas so you don’t waste your money or literally throw it in the bin by overbuying food. Cull the number of presents you buy and the list of people you buy for. Shop around for gifts, charity shops are fantastic! Change where you shop, cut back on your spending and make every penny count!
A January financial hangover isn’t good for your head, body or wellbeing. A new year should be a time to look forward, not to be carrying baggage through to the next calendar year. Find ways to lessen the January financial hangover and then work towards avoiding it altogether. It’s not going to be a quick fix but if we start working on it now, we’ll have things in place to improve things year after year.
