Festivals are like riding a high. Spendthrifts often tend to make emotional decisions at such a time. With Diwali round the corner, the temptation of good offers may be difficult to resist. Ishita Yashvi shares some useful tips to keep the budget in check.
It’s common to overspend during this time, partly because of our own poor planning and partly because of hidden costs of festivities that can look insignificant initially but can amount to a sizable sum later. During festivities, financial imprudence is not uncommon, whether it’s overusing your credit card or availing of that quick loan with an attractive payback plan. Let’s also not forget social pressures like FOMO which puts an unsaid pressure to celebrate better and bigger than last year.
If you’ve had a planned approach towards your finances then there’s little to bother about but if you’re fearing the post-festival period then there’s a problem at hand. Before you know it, the credit card bill runs way higher than you thought with your cash flows looking in a tight spot. So how do we avoid these money mistakes? How do we plan better? How do we navigate through festive expenditure with ease?
Here are some of my key learnings as a woman responsible for her finances.
Make a list
Prepare a list of what all you’d like to do during the festive season as opposed to leaving things open-ended. You may still digress from this list but it acts as a meaningful purpose to stay on track.
Set a budget
Put a budget aside for your festive shopping. It’s ideal to start putting a fund aside a couple of months prior. It builds a cushion and a sense of comfort. It may also be a good thing to make a short-term investment that matures around the festivities.
Avoid spending forward
Try to not spend forward i.e. charge cards and credit cards. During festivities, this can especially be tricky as one is generally happy and excited and is prone to making impulsive money decisions that lead to regret at a later time.
Have a payback plan
Calculate a repayment plan on paper in case you’re spending on debt i.e. spending forward. What’s your repayment strategy, is it an EMI? Or is it returning a lump sum in a stipulated time, for which you must have a pre-planned plan? The point is that you must have a repayment plan in place before spending ahead. Remember credit cards or charge cards are also debt that levy a hefty interest on late or minimum payments.
Track your spending. Tracking or keeping a record of your expenditure is also a very important step. Your budget won’t hold much value if you don’t effectively track your spending.
Shortlist shopping locations
It will also serve you well to shortlist the markets or fairs you want to visit as opposed to aimlessly visiting multiple places. For example, over time, I know that the Dastkaar Festival of Lights is a non-negotiable for me, so I definitely pay it a visit and skip many others.
It may be worth it to put your discount or reward points to use. This is quite common for most credit cards and co-branded debit cards. Do run a check if you’ve accumulated unused vouchers or reward points over time. If you have it in your kitty, it’s time to pull it out and see how well it could fit into your festival shopping budget. However here I’d like to caution you against spending on something just because you have a discount or a partly paid voucher. Remind yourself that exercising some discipline is key to good financial planning.
Save during festivities
It’s an Indian tradition to symbolically purchase gold on Dhanteras. Use this as an annual opportunity to invest in gold. It’s a safe long-term investment option as well. It’s easier to invest in digital gold these days that can be easily purchased or sold or gifted on apps like Gpay or PayTm. For minor charges, you can also take physical possession of digital gold anytime you like.
Also remember, Rome wasn’t built in a day. Your relationship with money and the will power to exercise control will come over time but what’s important is to start developing it early.
Make sure you make happy memories and enjoy the traditions. Even if you’re not cautious with your expenditures, look at the bright side and learn from your mistakes so that you’re wiser and more in control next year. Financial planning is a journey and you will only get better at it over time!
Follow Ishita on Instagram @ishitasudhayashvi
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