Three Steps to Financially Prepare for the Holidays

Budgeting, Financial Habit, Saving

Hopefully, you have recovered from the holidays, which is why I want to help you start preparing for the 2020 holiday season.

You may be thinking Keina isn’t this a little early? We’ve got the entire year!

Well, it is early but this is what financial preparation is all about. Giving yourself plenty of time to prepare before you actually need the money. This will help you avoid the holiday financial pinch when you realize you have not set money aside for travel, gifts, or other holiday expenses. So, preparing now will help you prevent those financial struggles this year.

So, let’s start planning for 2020!

1.Set Your Budget

Imagine it’s December 2020, how much do you want to have set aside to spend on the holidays? Since we just came out of the holiday season, go back and look at how much you spent on gifts, holiday travel, decorations, and hosting holiday dinners and parties. This is a great place to start because you just did all the things. And if you did not track your expenses from last year you can make a plan for how much you want to spend. Now we can start to proactively plan for this year. So for example, let’s say you spent $500 on gifts, $800 on travel, and $200 on miscellaneous from parties to hosting people in your home. The total amount you spent on the holidays was $1500. As you look at what you spent, consider if there is anything else that might change this coming holiday season that may increase or decrease your budget. These are the things that usually catch us off guard. Maybe you know you’re going to be flying to head out of town or you offered to host the family dinner. Whatever it may be, let’s make sure we account for that in setting your budget for 2020.

2. Determine How Much You Need to Save

If you said you need to save $1500, divide that number by the total number of paychecks you receive in a year, which is usually between 24 pay periods or 26 pay periods if you work for a company. If you are on a different pay cycle, take the total amount and divide it by 12 (total number of months) or 52 (total number of weeks).

So, if you desire to save $1500 by December here’s your savings plan all broken out for you.

Pay Cycle Amount You Need to Save

Each Paycheck (semi-monthly) $63 per paycheck

Each Paycheck (every other week) $58 per paycheck

Every Month $125 per paycheck

Every Week $29 per paycheck

Breaking down your larger financial goal will provide you with clarity on exactly what you need to do to reach the goal and make it manageable.

3. Automate Your Savings

Make your savings foolproof for you. Open up a CapitalOne 360 savings or an Ally savings account. Now, set up an automatic transfer, for the day after you get paid that goes directly into this savings account for the exact amount you said need to save to reach your goal. So, if you need to save $1500 by December that is $125 a month, $29 a week, or $63 every pay period.

Make your savings foolproof for you. Open up a CapitalOne 360 savings or an Ally savings account. Now, set up an automatic transfer, for the day after you get paid that goes directly into this savings account for the exact amount you said need to save to reach your goal. So, if you need to save $1500 by December that is $125 a month, $29 a week, or $63 every pay period.

Making a plan to prepare yourself financially is one of the most rewarding decisions you can make. Learning how to gain control of your money is not always about having to say ‘no’ to something. It is about making a plan to prepare so that we are more intentional about how we use the money we have to live a life that aligns with our values and goals.

Email me at keina@wealthovernow.com and let me know how much money you’re going to save for your 2020 holidays.

All the best,

Keina

P.S. Did you hear the big news? This year I’m going to help 60 hardworking and passionate women transform their relationship with money and gain peace of mind through my one-month coaching intensive. Five women have already committed to change their relationship with money.

If you know that you want to be one of those women, then apply to work with me and we’ll schedule a call to talk about what’s best for your goals. I want to help you set your intentions for 2020, so that in a year from now you will be able to celebrate getting out of the paycheck to paycheck cycle, saving consistently, paying down debt, and finally having clarity and confidence with how you’re using your money to support a life you love.

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