By: Sean van Zyl
The festive season is a time for joy, celebration, and spending time with loved ones. However, for many families, it can also be a source of financial stress. According to the Competition Commission, food prices have increased by a significant 50% since 2020, while wages and salaries now cover 13% less of basic expenses.
With additional costs such as gifts, travel, and festive meals, the holiday spirit can easily be overshadowed by financial worries. Even though inflation has eased slightly, food prices remain high, leaving families feeling the pinch. For households already stretched thin, enjoying the holidays without overspending has become a major challenge.
Financial stress during the festive season doesn’t just strain your wallet—it can also affect relationships. Worrying about how to pay for holiday expenses can cause tension and leave you feeling anxious rather than joyful. To avoid this, families need to plan and make decisions that ensure they don’t start the new year in debt.
Holiday budgeting isn’t just about making this season enjoyable. It’s about starting the new year on solid ground. Smart financial decisions allow families to focus on what truly matters: creating memories and spending quality time together.
Here are tips to help families enjoy the festive season without breaking the bank:
Create a budget and spending plan
Draft a detailed budget with spending limits for gifts, food, and travel to prevent overspending. List all necessary purchases and focus on prioritising needs rather than feeling constrained.
Get creative with festive activities
Save money by making homemade gifts or Christmas cards as a family. Look for unused items, such as decorations, that can be repurposed or sold to generate extra cash. Make meal preparation a festive event with music, themed outfits, and family involvement.
Plan for January expenses
Avoid the stress of a depleted budget in January by accounting for essential costs such as rent, groceries, and accounts in your holiday plan. Allocate reserve savings of R2,000 to R10,000 for unexpected emergencies, like medical expenses or insurance excesses.
Be strategic about accommodation
Travel expenses can accumulate quickly. Explore affordable options like house swaps with friends or family. Alternatively, consider renting a self-catering house and sharing costs with other families.
Give yourself the gift of financial wellness
Start by assessing your financial position and resources. Review your bank statements and receipts for the past 30 days to understand your spending habits. This spending audit will help you identify where your money is going and highlight areas where you can cut back in 2025.
By following these tips, families can enjoy a festive season filled with joy and meaning without placing unnecessary strain on their financial well-being.
* Van Zyl is a certified financial Planner® at Old Mutual Personal Finance.
PERSONAL FINANCE