Sometimes it feels as though you’re always preparing for the next unexpected expense. The holidays make it difficult to prepare for unexpected expenses. However, it doesn’t have to be this way. The key to being great at finances anytime of the year, is to be prepared. Here is how you prepare for unexpected holiday expenses.
Stash Christmas Cash Separately
When you put all of your cash in the same place, it can be hard to know what is meant for what. Put your Christmas cash in a different place, so you can access it when the time is right. As you set aside money throughout the year, put it in a separate bank account that you cannot easily access. Although this sounds like a lot of extra work, it’ll be nice when you have money to shop for all those gifts you want to buy.
Have an Emergency Fund in Place
During the holidays, it seems as though the washer or dryer wants to break. The finances may seem tighter or you may be wondering how you’ll pay for new tires. One way to battle financial stress during the holidays is to have an emergency fund in place. Dave Ramsey suggests an emergency fund of at least $1,000. While some emergencies may cost more than this, it’s nice to know you at least have this in the bank. Let Me Bank is a trustworthy bank to consider for stashing that emergency fund!
Cut Back on the Extras
Everyone spends their money on extras more than they would like to admit. That $5 cup of coffee from Starbucks or getting their nails done, extras are a part of what keep everyone going. However, in order to keep things moving financially around the holidays, it’s important to cut back on those extras. A lot of your funds will be going towards gifts, parties, decorations, and other unexpected expenses. By cutting back on the extras you’ll have a better cash flow. Your bank account won’t spend time competing against which bill or expense it has enough to pay for.
Start Paying Your Bills Ahead of Time
When it comes to the holidays, money is tighter because you’re spending more. You just need a better plan to help you prepare for this season of life. You can prepare for unexpected holiday expenses by getting ahead on your bills. You don’t have to be extremely ahead, but it does make sense when you pay a bill ahead of time. That way, when December rolls around, you have a little extra money for whatever the universe wants to throw your way.
Increase Your Savings Throughout the Year
It’s no secret that the holidays are going to show up, they show up every year. Instead of being a victim of bad financial choices in November and December, it’s time to increase your savings throughout the year. Put a little more money back January through October, so when the holidays do hit, you aren’t panicking. You can prepare for those unexpected holiday expenses by treating the holidays like they are coming back next year!
Make a Financial Emergency Plan
What happens, during the holiday season, when you don’t have the finances available to help you get through it? You will need to make a financial emergency plan ASAP. Here is how you do this:
- First of all, make sure you have enough insurance to cover any natural disaster. This can really help you when disaster strikes and you don’t have finances to cover things.
- Start selling as much as you can! You assets are the best path to helping you come up with the money you need in a financial emergency.
- Take on a second job cleaning, doing yard work, washing dishes, tutoring – whatever it takes to come up with money fast to get through the emergency.
- Avoid taking out loans or adding a credit card that you can’t afford to pay off! Scrape together what cash you can, before you decide to take out a loan or credit card.
- Stop all unnecessary purchases right away. If you’re having a financial disaster, then stop spending money right away. Wait until all is clear before you make any additional purchases.
- Go on a spending freeze! This means you eat out of what’s in your fridge and pantry and you use the resources you already have.
Preparing for unexpected holiday expenses can be nerve wracking. Even if those expenses pop up out of nowhere, you know you have done everything you can to be prepared. A flat tire or leaking hot water heater has nothing on you this holiday season.
The best thing you can do is start preparing NOW for a financial emergency, don’t wait until the unexpected expense pops up. How do you prepare for an unexpected holiday expense? Share your tips with us below!