How I’m Talking To Clients About Holiday Budgeting

The holidays are typically a time of joyful celebration, but for many, they are also a time of financial anxiety. According to a survey by the American Psychological Association, 89% of U.S. adults experience stress during the holidays, often linked to financial concerns. Many feel pressured to provide the ideal gifts, host events worthy of Pinterest, and travel to visit relatives.

These are all potential factors that can contribute to debt woe. Clients may encounter mixed feelings throughout the holidays because while they strive to stick to a budget, they also want to take advantage of holiday deals, impulse buy, or give generously. 

Key Takeaways

• Utilize budgeting templates to track all potential expenses, including gifts, food, travel, and decorations, while committing to a spending limit to avoid impulse purchases.
• Suggest thoughtful, low-cost gifts and budget-friendly activities to foster meaningful connections, such as homemade treats or family outings.
• Encourage clients to discuss their holiday budget with family early on to foster understanding and support, reducing the likelihood of debt and stress.

What I’m Telling My Clients

Here are three tips I offer my clients to help them enjoy the holiday season with a clear fiscal plan of action:

1. Use a Budgeting Template

This is the most important step, and many sample budget templates are available online. Clients can also make their own or download my version. I suggest making a thorough list of every expense that could cross their holiday checkbook—from items like food, presents, travel, and decor. Committing to a spending limit takes a lot of the headache out of saying no to those impulse buys. 

Encourage clients to build in a buffer for unexpected situations so that they have a cushion to fall back on.

2. Be Creative in Gift-Giving and Gatherings

Encourage clients who love to give gifts to be creative. Thoughtful yet cost-effective gifts like baked goods, handmade ornaments, or candles may be more appreciated by the recipient than an expensive store-bought present. Friends and families can create happy memories through low-cost social activities like ice skating, visiting holiday markets, volunteering, hiking, or throwing a movie marathon.

3. Be Transparent with Family

Suggest to clients that they have an honest conversation with their family about their holiday budget—and do it early. They may feel uncomfortable initially or even a little embarrassed; however, they will quickly get past those feelings once they get through one holiday season without debt. They may be surprised at how many other family members feel the same way and are excited to follow their good example of financial discipline during the holidays.

The Bottom Line

The holidays can bring financial stress, but with a solid budget, creative gift-giving, and open family communication, clients can navigate the holidays confidently. These strategies promote financial discipline while encouraging meaningful connections, transforming the holidays into a more enjoyable and fulfilling experience that won’t break the bank.

Read the original article on Investopedia.