228 | How to Get Through the Holidays Without Going Into Debt

Tired of going deeper in debt year after year around the holidays?

Start planning now so you can break that cycle.

In this episode, let’s talk about strategies you can implement to stop going into each new year with new debt from the holidays.

• • planning my family trip to Jamaica

  • preparing for Thanksgiving costs

  • preparing for the costs of holidays like Christmas and Hanukkah

  • preparing for New Year’s Eve costs

  • the benefit of preparing ahead of time

   

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You’re listening to Wealthyesq. We are a community of lawyers who believe that true wealth is having control of our time. I’m Rho Thomas, and as a busy wife, mom and former Biglaw associate, I know all too well the tension between the culture of the legal profession and pretty much everything else you want to do in life. That’s why each week, I’m bringing you the information and tools you need to improve your money mindset and manage your money to create true wealth. Because ultimately, it’s not about the money. It’s about the freedom and flexibility the money affords.

Hey friend. Welcome back to the show. I hope you’re doing well and having an amazing day so far. Today we are talking about how to get through the holiday season without going into debt. So my family typically takes a trip at the end of the year, and we started planning for that trip last month, in September. So this year we’re going to Jamaica, which I am really looking forward to my boys just got their passport, so this will be their first time out of the country. But we started planning for the trip in advance. And even when we were taking local trips, like while we were getting out of debt and we were going to closer places like Tennessee or North Carolina, things like that, we still would plan the trips months in advance. We wanted to make sure that we had everything in order, we had the money that we needed, so that it wasn’t a huge strain on our budget in December. So I want to make sure that you are thinking about the holidays in the same way that is how you can get through the holidays without going into debt. So we’re going to go through some tips that you can implement so that you can make sure that you get through the holidays without going into debt and without putting a huge strain on your budget in December, often, we allow the end of Year holidays just sneak up on us. And the thing is, they happen every year around the same time, right? It’s not a surprise. Typically, we have holiday traditions that we do every year that we know are coming. So we can start thinking about those things now. At this point, when this episode comes out, it is only the first week of October, so you’ve got about two to three months until those holidays hit. And just to be clear, I am speaking from my personal perspective here in the US. I know from my Canadian clients that you all will be celebrating Thanksgiving in the next week or so, and there may be other holidays that I’m not familiar with in other parts of the world. But the overarching point of this episode is that when you have holidays where there are traditions or events or things like that, where things can get expensive, where you need to have money, then you want to start planning for them ahead of time, like months in advance, because when you just allow them to catch you off guard, and you don’t prepare for them financially, that’s how you end up in a bunch of debt. For the majority of the lawyers I work with, the big ones tend to be Thanksgiving, Hanukkah and Christmas, which all fall around the end of the year, and often it has led to them having a bunch of new debt from the holidays going into the new year. So I want you to prepare for this ahead of time. I want you to be thinking about your finances and what you’re going to be doing around the holidays now, so you don’t end up in that same situation where you’ve got the cost of the holidays hanging over your head as you go into the new year, and you’ve got a bunch of new debt that you got to figure out what to do with. So Thanksgiving is coming up in November. Often, that’s a time where we get together with our family or our friends. There is often travel involved. For some people going to see their family, going to see their friends. For others, it’s hosting people, family and friends are coming to you. So you know, if you’ve got people coming to your house, you’re preparing meals, you’re you’re buying food that you don’t normally buy, like all that kind of thing you want to be thinking about it. Now for my family, we typically are the ones to host, so we have people coming to us, and so we start in October, adding a little bit extra to the grocery budget so that we can start getting those things that we need for Thanksgiving. So, you know, that’s something that you can implement as well. Think about what foods you typically prepare. Obviously, there are going to be things that you need to get closer to Thanksgiving, but you can start getting non perishable items now and just stocking up on them, and that way you spread that cost out over multiple weeks, rather than it be like all at once in November, when you’re ready to prepare your Thanksgiving meal. So that’s something that you want to be thinking about. If you’re one of the people who is traveling for Thanksgiving, then you want to be thinking about how much it’s going to cost for you to get to where you’re going. So what’s your mode of transportation? If you’re driving, how much is gas going to be if you’re flying, how much is that ticket, if you are, you know, staying with family or friends, that’s great, but if not, then how much is the cost of the hotel or the Airbnb, that kind of thing. And you also want to think about food beyond Thanksgiving, because often when we travel, we don’t just stay that one day. We have to, like, feed ourselves. We’re going to be there for a longer period of time. So you want to think about the cost of food during your trip. You also want to think about other things that you might do while you’re there. So maybe you’ll be home and you’ll be meeting up with friends that you haven’t seen in a while. Or maybe you want to do other things with your family. Or the day after Thanksgiving is Black Friday. Maybe you want to do some Black Friday shopping. So you want to have money available for that. When you think about all these costs now, then you can be setting that money aside for Hanukkah or Christmas or any other celebrations at the end of the year where you might give gifts, or you might be traveling to be with family and friends again, you want to be thinking about these same kinds of things. So if you’re traveling again, where are you going? How much does it cost to get there? I have a client who lives in New York, but she’s actually from here, from Atlanta, and we have been setting money aside little by little for her ticket back home for the holidays. So, like she’s known for a long time that she’s coming home, and so she started setting money aside around August, so that she has that money ready when it’s time to get her ticket to come home. For my family, we start looking at how much things are going to be and we account for those costs in September, October, November and December. It’s like we account for those costs in all of those budgets, because that way, we’re spreading the costs out over four months, rather than it all hitting us at once in December. If you’re traveling, you might need to book now, depending on where you’re going, because when we were looking up stuff for Jamaica all the rooms that we wanted. Were already books so we ended up having to get an Airbnb, and so you’re going to have to put a deposit down now. But you can still be planning for the balance that you’re going to have to pay whenever that’s due. Another thing you want to be thinking about gifts. If you’re getting gifts for people, think about which people you’re buying gifts for. How much do you want to spend on each person’s gift? And it can be different amounts for different people. So you get to decide that. But once you have the amount, total it all up, and then you can divide it out by how many months you have left until you need to get the gifts. And then you can start setting that amount aside each month. It could also be that when you total it all up, that amount that you think you want to spend isn’t actually feasible. So you can make adjustments there. But the point being once you have the total that you’re going to spend, you can divide it up and be setting it aside so that it doesn’t all hit you all at once, and you can even spread it out further. So I have a client who started saving in January for her December purchases, like we started this process around this time when we were working together, but she decided that she wanted to stretch it out more to make the amount that she needed to save each month less, and so she started saving in January for what she’s going to spend in December. So that’s something that you can do as well. You also want to be thinking about holiday parties. If you’re planning to go to holiday parties, think about the gifts for that. Thinking about outfits that you might want to wear if you want to get something new, and then if you’re planning to do something for New Year’s Eve again, you want to be thinking about the cost for travel, the cost for accommodations, the cost for whatever else you might want to do outfits, you want to get that kind of stuff. The whole point is planning ahead. You don’t want to just let the holidays sneak up on you, because then you’re spending money, you’re putting stuff on credit cards, and there’s this underlying stress, or maybe even guilt around your money when it’s supposed to be a fun and happy time with your family and friends. So set yourself up to have a stress free, guilt free, debt free holiday season so that you can celebrate with your friends and family and just enjoy the moment. Start getting prepared now. It’s only the beginning of October, so you’ve got almost two months until Thanksgiving, you’ve got about three months till Christmas and Hanukkah and any other end of Year holidays that you might celebrate. And if you’re celebrating different holidays that fall on a different timeframe than what we’ve been talking about here, then you can apply the same process for next year. So just be thinking a couple of months ahead of when those holidays fall, so you can start planning it out and not have to take that hit all at once in the month that the holiday happens. Don’t just wait and be surprised, right? The holidays are going to pop up the same time every year. Don’t wait. Don’t let them pop up on you, and then you have to use your credit card and feel stressed and all of that kind of stuff, plan ahead, and that will give you a much more peaceful experience as you celebrate the holidays. All right, that is it for this week’s episode. Please take a second and subscribe to the show and leave a review. When you have more reviews, more subscribers, it means that the podcast platforms will recommend the show to more lawyers, which means those lawyers can get the information they need to manage their money better. And as always, I appreciate your support. As we close out, friend, I pray that you take the information you learn, apply it in your life and open up to the realization that wealth is available to you, as you do that consistently, week after week, you’ll continue to take steps to regain control of your time, build wealth and live the life of freedom and choice you deserve. Talk to you later.