How To Get Your Finances Back On Track After The Holidays

You probably know by now that you went overboard into a shopping frenzy, but what you might not know is how much this has taken a toll on your budget.

Deal with this problem head-on and start doing the math now. Plotting your credit card bills against what’s in your bank account – or whatever is left of it – could help you come terms with the reality that you need to cut back on your spending for real.

As you make a list of all your holiday debt, you should take note of which credit card to pay first. Paying off the one with the highest interest rate could help you lower your total debt much faster. You could also transfer your balance to another credit card with a zero percent interest rate. This way, you don’t have to worry about the principal loan amount.

Be sure to monitor your progress so you would know if you are still sticking to your payoff plan.  

After assessing your holiday expenditures last year, you probably have a clear idea of how much you are likely to spend next holiday season. So as early as now, start following a budget and preparing for the next holiday season.

It may be time to simplify your lifestyle and go on a crash financial diet. That means limiting your spending only to your basic needs and expenses that you can’t do without. This might also be a good time to remind yourself about the ills of impulse buying, which only leaves you broke at the start of the year.

Find ways to cut your monthly expenses like packing your lunch for work or buying generics instead of branded goods. If you must turn your out-of-the-country trip into a local getaway, that’s perfectly fine. What’s important is that you are taking active steps to help yourself make up for binge spending the previous month.

If you could commit to this habit of saving and budgeting year in and year out, you should be able to spare yourself from a cycle of financial meltdown.

Hopefully, boosting your savings is one of your financial resolutions this year. You have another great year to earn more money, so take this as an opportunity to build your wealth.

Use some of the bonus money you earned to get your savings rolling. The New Year gives a sense of a fresh start, so use it to motivate yourself to save more.

If you receive a raise from work this year, dedicate a portion of it to your savings. Even if a pay raise isn’t happening anytime soon or if your monthly income varies depending on the amount of work you do, you could allot a certain percentage to your savings fund. The key is not to miss setting aside part of your income toward your savings goal.

You can also take part in a savings challenge. There’s the 52-Week Challenge, the 30-Day Challenge, and so on. Do it on your own or in a friendly competition with family members or your most trusted friends.

Another wise option is by partnering with financial institutions to help you build your savings. BPI AIA's Build Life Plus is both a savings and an investment product with life insurance benefits added into the package. Your funds in Build Life Plus are managed by professional fund managers, so you can be sure that your investment grows over time.

You’ve done it all – budgeting, belt-tightening, and financial planning. If the cash flow is still in trickles, it’s time to be more creative. You can look for a second job online or get paid by answering online surveys to increase your income.

Set up a garage sale at home to sell some of your pre-loved items. You can even auction excess Christmas presents you don’t have plans on using. Then use the proceeds from your sales projects to start an e-commerce store. Any of these should help tide you over until you see yourself free from financial woes.

Recovering from holiday spending hangover should not stop you from making investments. Investing promises protection not just to your wealth but also to your and your family’s financial security. You have a variety of investment options such as stocks, mutual funds and insurance.

For instance, with health insurance, you’re protecting yourself from emergency hospitalization or consultation fees that might strain your financial resources further. You also have the option to take out an insurance plan that integrates investment opportunities into your insurance, such as a Unit Linked Insurance Plan (ULIP) and Variable Universal Life (VUL). These insurance products provide you with life insurance benefits and at the same time come with investment options for stocks, bonds, or mutual funds.

Today, buying life insurance or health insurance in the Philippines is fast and easy. You can just go to a bank like BPI, which has up to 800 branches nationwide and ask a Bancassurance Sales Executive about how you can invest your money in a variety of insurance products.

While there’s nothing wrong with shopping during the holidays, you don’t want to start the year broke. Follow these simple, actionable steps to get your finances back on track.