You might not be a little kid anymore, but this season was simply made for your inner child! The holiday season can overload us with opportunities for fantastic fun and resounding joy – like holiday vacations, gatherings with family and friends, special events, gift-giving, and much more. While the joy of the season can’t truly be bought, virtually everything related to the holidays comes at a financial cost. And for many of us, those costs can become overwhelming.

The key is to tame that holiday sending while it’s happening so you don’t blow your budget for the holiday season and for months to come. Getting your holiday spending under control is best accomplished as early in the season as possible so that it can be built into your holiday plans.

Here are some strategies to try to tame your holiday spending:

Create a Holiday Budget

Using what you know about your current financial picture – including your income, level of savings, typical monthly expenses and other factors – designate an amount of money to use as your starting point for a holiday budget.

Make a List

Begin by writing out your gift list, including the travel, events, gatherings, charitable donations, and other purchases you are planning for the season. Include cost estimates for each time on your list. You can also refer back to the last few years to get an idea of how much you typically spend.

Check it Twice

Add up your list and check it against your holiday budget. If your expected expenses are greater than your budget, it is time to trim your list. If you have a surplus, you should still try to stick within your budget in case of a financial emergency and put it towards your savings.

Comparison Shop

Whenever possible, look around for the best price on everything from gifts and décor to food and travel. Keep in mind that one retailer may have an exceptionally low price on one item but make up the difference by keeping other prices higher – so you’ll likely have to shop multiple retailers. Book travel as early as possible to avoid last-minute fares and accommodation prices, which tend to increase as the holidays draw nearer. Use coupon codes and keep track of limited-time sales, too.

Get Hands-On

Hand-made gifts can be extraordinary, so consider making some gifts to help stick to your holiday budget. Doing some simple baking or even putting together a uniquely curated gift basket yourself can help you craft some of the most thoughtful gifts on a budget.

Monitor Your Spending

As the holiday shopping season progresses, keep track of your expenses and continually compare them against your holiday budget. Making adjustments along the way may be necessary and will help you better prepare for next year, if needed.

Focus on the Joy

Naturally, the holiday season is really about the joy it brings. If you find that one of your holiday traditions isn’t something that truly lets you experience the joy of the season, then try skipping it and reconsidering it for next year. Ultimately, deciding to eliminate expenditures altogether can make the most positive impact on your holiday budget.

Once the holidays are over, make sure you have a plan if necessary, to pay down any holiday debt you have accrued.

When you earn income, you get to decide how you spend that money. What you spend money on won’t be the same as other people, because everyone has different spending habits. Learning when and what to spend money on is an important part of money management.

Opportunity Cost

Every purchase comes with a tradeoff. This tradeoff is called the opportunity cost, and it means that when you spend money on one thing, that money is no longer available for a different purchase. If you buy a new video game with all your money, for instance, you won’t have money to buy a Lego set.

Money is limited, so before you make a purchase, think through other ways you could use it. What is the opportunity cost of a purchase? It’s also important to identify what is a need and what is only a want. Consider what you might want to spend money on down the road.

Spending Decisions

There are different reasons for spending money. Does it cost more than you have to spend? Or are you buying it just because it’s on sale?

You may want to buy something just because other people you know have it, or because a friend is pressuring you to make a purchase. This happens to everyone. Try to avoid spending money because of peer pressure.

Advertising also influences you to spend money. Not all advertising is accurate. If you’re researching a purchase, make sure you’re using reliable sources for information.

To save money, you may want to split the cost of an item or service with someone. Or borrow an item or trade a service, like doing a chore for a friend in exchange for using their bike for the day.

When it’s time to spend money, you can use cash, checks, and cards. Paying with cash is immediate—the money is gone right away. If you use checks, the money may take a few days to leave your checking account. With a debit card, there could also be a short waiting period.

If you use a credit card, you’ll make a payment now and need to pay the money back to the credit card company later. If you don’t pay the credit balance in full by the due date, you’ll owe interest on what you borrowed. This increases the overall cost of the purchase.

Even if you don’t have a lot to spend, making good spending decisions now is necessary practice for spending appropriately in the future.

*Remember, you must be 18 years or older in order to apply for a credit card. Most credit card issuers will ask for a co-signer or proof of independent income for those under 21. 

Article Courtesy of Banzai Learning Center

Disclaimer
While we hope you find this content useful, it is only intended to serve as a starting point. Your next step is to speak with a qualified, licensed professional who can provide advice tailored to your individual circumstances. Nothing in this article, nor in any associated resources, should be construed as financial or legal advice. Furthermore, while we have made good faith efforts to ensure that the information presented was correct as of the date the content was prepared, we are unable to guarantee that it remains accurate today.

Neither Banzai nor its sponsoring partners make any warranties or representations as to the accuracy, applicability, completeness, or suitability for any particular purpose of the information contained herein. Banzai and its sponsoring partners expressly disclaim any liability arising from the use or misuse of these materials and, by visiting this site, you agree to release Banzai and its sponsoring partners from any such liability. Do not rely upon the information provided in this content when making decisions regarding financial or legal matters without first consulting with a qualified, licensed professional.

Tips to lower delivery and eating out costs

You probably remember a fun dinner celebrating a birthday or anniversary with friends and family. But what you may not realize is how much dining in and eating out goes unnoticed. The small grab-and-go lunches, fast casual dinners, pizza delivery, and coffee add up over time and the results can be costly. Here are some easy-to-implement steps to reign in these expenses.

Meal Planning. Look at your week to determine the following:

Now consider which of these could be replaced by something you make at home. Changing just a few can help your budget.

Buy Frozen Foods. Most frozen food is a lot cheaper than delivery and eating out. With a lot of great options in the freezer section from famous brands and restaurants, you can still eat the foods you love at a fraction of the cost.  

Approach Social Gatherings Differently. Social engagements with friends over delicious food don’t have to break the bank.

Stretch Your Meals. When eating out or having food delivered, think about meals for the next few days. Order a little more, or portion out your meal to cover your lunches for the upcoming week. 

Eat Your Leftovers. 40% of the food in the U.S. is wasted each year. To save money, you actually need to eat leftovers, otherwise, you’re just throwing money away.

Brew at Home. A daily coffee habit can be costly. Buy a decent coffee maker and start brewing at home to save money in the long run.

Spot the Deals. If you’re going out or ordering in, you can still be a savvy shopper by looking for promo codes, coupons, or membership services to reduce your costs and help you save money. 

Article Courtesy of SavvyMoney Blog

Income and expenses are two of the most fundamental aspects of a budget.

Income

To have a budget, you need income. Income is any money that you receive. The most common type of income is earnings from a job, but other forms of income include interest (such as from a savings account) and investment earnings. Depending on the kind of income, you may earn it at regular intervals (weekly, biweekly, monthly, etc.) or sporadically, such as when you make a sale or earn a commission.

Expenses

Expenses are all the things you spend money on, from the frivolous (an extra treat after a long day) to the required (housing and utility payments).

It may be helpful to think of your expenses as falling into two categories: needs and wants.

Needs are the things you require to live and work in relative comfort. This includes things like…

Wants are the things you may not need to survive, but that make your life more enjoyable. This includes expenses related to vacations, hobbies, and entertainment, but also the more expensive or extravagant versions of your needs. You need food, but want to go to fancy or expensive restaurants. Similarly, you need clothes, but you don’t need the newest, trendiest clothes. It’s important to be honest when considering what expense is a need and what is a want, so you can effectively manage your expenses.

Balancing Income and Expenses

For a sustainable budget, your income needs to stay above your expenses. If not, you’ll have to borrow money or dip into savings to make ends meet. After covering your expenses, your extra income will ideally be saved for future goals and an emergency fund. In accounting terms, the balance between your income and expenses is often referred to as your cash flow. If you have a positive cash flow, your income is higher than your expenses. If you have a negative cash flow, your expenses are higher than your income.

While it may not work for everyone, the 50/30/20 rule can be a helpful place to start when considering a healthy budget. With this, your expenses take up 80% of your income, with 50% going toward needs and 30% going toward wants. The remaining 20% goes into savings. If that isn’t an option right now, there are a few changes you can make to bring your income and expenses closer to that goal (or at least closer to something sustainable), as outlined below.

Managing your income and expenses is a lifelong process. As they change, your budget will need to change as well. It’s important to reevaluate it periodically to ensure that you’ve accommodated for any life changes.

Article Courtesy of Banzai Learning Center

Disclaimer
While we hope you find this content useful, it is only intended to serve as a starting point. Your next step is to speak with a qualified, licensed professional who can provide advice tailored to your individual circumstances. Nothing in this article, nor in any associated resources, should be construed as financial or legal advice. Furthermore, while we have made good faith efforts to ensure that the information presented was correct as of the date the content was prepared, we are unable to guarantee that it remains accurate today.

Neither Banzai nor its sponsoring partners make any warranties or representations as to the accuracy, applicability, completeness, or suitability for any particular purpose of the information contained herein. Banzai and its sponsoring partners expressly disclaim any liability arising from the use or misuse of these materials and, by visiting this site, you agree to release Banzai and its sponsoring partners from any such liability. Do not rely upon the information provided in this content when making decisions regarding financial or legal matters without first consulting with a qualified, licensed professional.

Ever been playing a game and needed just one more life to finish the level? That life may cost you, but what’s $1.99 this one time? The problem is that that’s exactly how predatory companies want you to feel.

Many apps, games, and websites use deceptive or exploitative tactics to convince you to make purchases. While the costs of these items are usually fairly low, small purchases add up. Being aware of the most common practices these platforms use can help you spot and avoid them before falling into the trap.

Financial Traps

“Sales”

Many sites arbitrarily raise their prices so that they can offer sales with big discounts. This makes it feel like you’re getting a great deal. Who could turn down 40% off? The problem is that you think you’re saving money when you really aren’t and, thus, buy something when you normally wouldn’t.

Tiered Access or Paywalls

Some websites can suck you in by giving access to certain parts of it for free, but many features (often the best ones) aren’t available unless you pay. There may even be tiers. You pay a little for some content, but you’ll need to pay even more if you want the rest or want it without certain annoying features like ads.

Subscriptions

Paying $10 a month doesn’t sound too bad. But if you consider it is $120 a year, that can take a heavier toll on your budget. With multiple subscriptions to different games, apps, and websites, you’re suddenly paying a lot more money than you probably realize. Most companies also require you to opt out of a subscription that automatically renews, so if you aren’t paying attention, you could accidentally get stuck paying for more than you intend.

Careful Prices

It’s no accident that an extra life costs $0.99 instead of $1.00 or that an in-game item costs $8.99 instead of $9.00. When you read the “lower” price, it’s easier to justify buying it.

Psychological Traps

Intermediate Currency

Many games, apps, and websites require you to buy an intermediate currency that you use to buy things on the site. Whether they call it jewels, tickets, coins, or anything else, it’s a common way to hide what you’re actually paying. An item may cost 5,000 jewels, but what does that mean in actual dollars? If you already have the jewels in your inventory, you’re much less likely to check.

Similarly, when you buy the intermediate currency, you’re usually forced to buy them in predetermined bundles. This can lead to buying more than you need. Say, for example, you can get 200 tickets for $2.00 or 500 tickets for $4.50, but you only need 300 tickets. Regardless of how you get there, you’re forced to spend more than you need and may even be tempted to buy extra due to the “good deal.”

Addictive Games

Some games are designed to be extremely addicting. Like gambling, you may become convinced that you just need one more try to win or get the reward. Or maybe you feel good when you succeed. If the game asks you to pay to keep playing, you’re much more likely to do so. Some companies know this and take advantage of it.

Timed Deals

These deals are used to entice you to buy things by giving you a time limit. “Buy one get one half off, but only today,” or “Buy in the next five minutes and get double the points.” When you’re forced to make a snap decision or fear you may lose out on savings, you may buy something that you normally wouldn’t.

Pay-to-Win Scenarios

Similar to paywalls, some games may let you play for free, but to have any real chance at doing well or winning, you’ll need to purchase in-game items or stat boosts. This can be particularly effective when players are pitted against each other in competition.

Of course, some of these practices are more manipulative than others, but you should be aware of all of them when you make a purchase online or in an app. Ask yourself if any of these practices are being used to convince you. If so, it may be worthwhile to take a step back and reevaluate whether a purchase is actually worth your hard-earned money.

Article Courtesy of Banzai Learning Center

Disclaimer

While we hope you find this content useful, it is only intended to serve as a starting point. Your next step is to speak with a qualified, licensed professional who can provide advice tailored to your individual circumstances. Nothing in this article, nor in any associated resources, should be construed as financial or legal advice. Furthermore, while we have made good faith efforts to ensure that the information presented was correct as of the date the content was prepared, we are unable to guarantee that it remains accurate today.

Neither Banzai nor its sponsoring partners make any warranties or representations as to the accuracy, applicability, completeness, or suitability for any particular purpose of the information contained herein. Banzai and its sponsoring partners expressly disclaim any liability arising from the use or misuse of these materials and, by visiting this site, you agree to release Banzai and its sponsoring partners from any such liability. Do not rely upon the information provided in this content when making decisions regarding financial or legal matters without first consulting with a qualified, licensed professional.