Now that inflation is at an all-time high in several countries, what's the best way to prepare for Christmas financially? We write all about it.
It’s that time of the year again! Christmas is just around the corner, but this year’s different. This year we’ve witnessed record inflation rates all over the world. Nigeria’s inflation rate is over 20.8%, the highest in the past 17 years. Ghana's inflation rate hit its 21-year high of 37.2%. Kenya's inflation rate also broke its record high of 9.2%.
This means that this Christmas requires much more financial wisdom before putting any money down for the festivities. Here are 6 ways to prepare financially for Christmas.
1. Set a Christmas budget
A budget is crucial to prepare financially for Christmas. Your budget acts as a roadmap of how you should spend your money to get optimal use of what you have. As Christmas is drawing near, you need a budget to make sure that you’re spending your money according to plan without going overboard.
Start by setting aside how much you will spend for Christmas. It’s okay to work with estimates if you don’t have the exact prices of the items you will buy during Christmas.
Your budget should include Christmas gifts, and Christmas celebrations (if you’re celebrating at home or outside which will include transportation, etc). Try and be as precise as much as you can with what you’ll be spending this Christmas. This will give you a good picture of how much money you’ll need this Christmas.
I’d personally advise you to add a bit of a buffer for almost every item on your budget or a general buffer after doing your budget.
Note that your Christmas budget is separate from your regular monthly budget for your day-to-day activities. So your Christmas budget should be a sub-set of your monthly budget.
2. Be on the lookout for Christmas deals
Although traditionally the Christmas season is when the prices of a lot of goods and services go up, it’s possible for you to see some really good Christmas discounts and bargains.
Buy from places that have Christmas deals that will help you spend less. Shop from places where you can get cashback rewards or bitcoin rewards for your shopping. You can use the rewards for other items. Every penny counts.
3. Supplement your gifts with gift cards
As much as you’d love to buy big gifts that you can wrap in beautiful Christmas wrappers, your budget may not be able to carry that this year. That doesn’t mean you won’t be able to give gifts to your loved ones.
Gift cards also make great gifts too! If you’re currently in a crunch this Christmas, they would make a good alternative as gifts. They’re relatively cheaper because you have the option to buy in accordance with your budget. Plus, the person you share the gift cards with will have more freedom to choose how they’d like to use the gift cards. You can never go wrong with that.
4. Keep saving
You never know how the market will perform as you’re approaching the Christmas period. If you’re living in countries like Nigeria, Ghana, and Kenya, the local currency-to-dollar rate might shoot up this season. This means you have the potential of making a gain from the difference and have extra cash for Christmas.
So, don’t neglect your saving habits this Christmas just because you want to celebrate. Don’t miss out on the opportunity to use the change in prices to your advantage. Bitnob is a great place to save in USD. Munachi used Bitnob to save in USD to travel to Morocco. How cool is that?
5. Plan your Christmas celebration with more people
You don’t have to forego the opportunity to actually celebrate Christmas this year because of your tight budget. You can plan a Christmas celebration with more people.
Get your friends or family members involved in planning a Christmas celebration. They will be able to pitch in the funds to throw a Christmas party or get-together, This will help spread the cost of celebrating Christmas, plus you get to have a good time with friends and family.
6. Set a financial limit
I know I mentioned setting a budget but sometimes it’s good to have a specific figure in your mind that you can have that will represent the line in the sand — a number that you’ll never cross. Keep that number in your head and use it as an anchor when you’re spending so you don’t spend overboard.
Let’s say your financial limit is N100,000, use that number to guide your spending. Once you’re about to cross that limit, stop your spending. This will require a lot of discipline but the future you will be grateful you didn’t cross your spending threshold.
Your Christmas can still be merry
Although this year’s Christmas might have you working with a very tight budget, it should never take the joy out of the season. You can still enjoy the festivities. Your friends and family will still be able to get gifts. This can only happen if you exercise prudence with your finances this year.