The holidays can be filled with rich connection, cultural significance and religious traditions. No matter how you celebrate, there are ways to navigate the increased expenses and continue to build your investment savings, allowing you to manage financial stress. 

Make a holiday budget and stick to it

Create a list of the people you’ll buy gifts (or gelt or zawadi) for and establish a budget for that list—whether you budget per person or go with a total overall amount. 

Creating a budget for everyone on your list, instead of just specific people, will allow a little more flexibility—if someone’s gift costs a little more, you can adjust and save on another person’s present. 

As you make your holiday budget, include these categories to get a full picture of the spending money you have available:

• Income
• Planned charitable donations
• Living expenses (housing, utilities, food, gas, etc.)
• Debt payments
• Investment contributions

This allows you to set realistic expectations for how much can go towards holiday spending.

Do you celebrate the holidays with many loved ones? If it aligns with your holiday customs, explore doing a gift exchange rather than purchasing individual gifts for everyone.

Start saving January 1

Kickstart your savings for next year’s holiday spending right away. Take a look at your income and expenses to discover how much you can save each month. Putting a little money aside regularly can relieve some stress and allow you to enjoy all that the holidays bring once December comes.

For example, if you save $75 a month, you’ll have $825 by next December to support your holiday celebrations. A simple holiday savings plan can allow you to avoid debt completely, and it won’t affect your daily living expenses or regular investment contributions.

Fully commit to your investment plan

Having pre-authorized contributions (PACs) can allow you to stick to your savings plan, even when it may be tempting to pause in favour of holiday spending.

What’s a PAC?

A PAC is a recurring automatic withdrawal that transfers a pre-specified amount of money from your bank account and puts it in an investment or savings account, like an RRSP or TFSA. You can schedule PACs weekly, bi-weekly, semi-monthly or monthly, and you get to pick the amount of money you want to move.