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  • It has been a tough financial year for South African households.
  • Overspending in the festive season will devastate your finances for next year. 

After painful petrol price and interest rate hikes this year, this is going to be a tough Christmas for many South Africans - but January will be tougher if you don't watch your finance this festive season.

Here's how to avoid overspending:

Budget

Because many people tend to get paid mid-December, it is advisable to plan ahead and budget for all your expected expenses. 

Gregg Sneddon, financial planner at The Financial Coach, says you will have 45 days to get through with one salary, so make sure you have carefully planned what you will spend it on.

He recommends talking to your family about your spending priorities over the festive period. "It's becoming a conversation many families need to have," he tells Business Insider


Save your bonus

You've worked hard for it, but don't blow it all at once.

"Yes, you deserve to enjoy yourself in December, but within reasonable limits," says Thami Cele, head of retail deposits at Absa. He advises you put aside a third to half of your bonus as it could potentially tide you over in January.

"Put it in another bank account if needs be, away from your day-to-day banking account so that you are not tempted to spend it."


Avoid swiping

"You don't think of how much you are spending when you swipe," says Sneddon. Try using cash instead. 


Renegotiate your contracts

Review your current contracts to make sure you are getting the most value for your money, says Tony Pick, head of investments and savings products at Standard Bank. This is especially true for short-term insurance. 


Make the most of your rewards

Sign up for rewards programmes where you shop and make sure you redeem them, says Cele.

Better yet, accumulate the points and use them in January.


Get a 'checkmate'

This is someone who help to keep your spending in check: a partner, spouse, friend or relative. You can also delegate them to be your authoriser on big ticket items.

Cele says you should ask them to grill you with tough questions like "do you really need this?" or "have you considered other options?" if you want to spend money.


Pay it forward

Where possible, get your January expenses out of the way in December. 

If your children have past their growth spurts, then it's okay to buy their uniform in December, says Sneddon.

If not, then you might have to buy it in the new year or as they proceed to grow. Buying stationary in December is always a good idea.


Do not let history repeat itself

Go through your bank statements during the 2017/2018 festivities - and find out where you went wrong.

"This requires you to audit your own bank statements," says Cele. Do not rationalise or find excuses for those expenses.

Also, don't forget to review your latest bank statements  for new threats and opportunities.


No new costly resolutions

Don’t fall into the trap of New Year’s resolutions that need extra funding example, joining the gym or new expensive hobbies, says Pick.

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