Summer Holidays and How to Not Bust your Budget

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What do summer, vacations, budgets and planning all have to do with each other? Summer is a time for many people when the disciplines of budgeting sometimes go out the window - whether because of extended vacations or the weekend draw of the beach, it is easy to throw caution to the wind and just spend more than expected. However, a bit of planning can pay big dividends, particularly since the additional expenses of back-to-school shopping, as well as holidays like Thanksgiving, Christmas, Hanukkah and more are right around the corner.

How to think about budgeting and planning without removing the fun and spontaneity of summer months?

1. Be aware and take stock: It is a good idea to take a quiet evening and write down what really matters to you in life. That may seem like an esoteric way to begin something as mundane as budgeting, but if you are spending money - and finding it hard to make ends meet - because of spending on things that ultimately don’t move you closer to your goals, the first step towards rectifying that situation is to be aware. For example, one of my son’s recently quit smoking - which I was thrilled about on a number of levels - but he said to me “I realized that the only thing you get from smoking is no nicotine withdrawals- which hardly seems like a benefit worth killing yourself for. And, I will save $2,000 per year!”.  

2. Plan for your weaknesses- and know when to say “no”: If you want to allocate a certain amount of money for going out, or shopping, or whatever is your budget killer - make a plan to spend that much money (and only that much) and stick to it. So if you want to go out one night a week, figure out which night that will be - but then be clear in your own mind that you will say “no” to other invitations to go out. If you are going on vacation, figure out how much you can afford to spend on the vacation and stick to it. Is it hard to stick to a budget when on vacation? It can be- that is why when you are planning your vacation budget with Pefin, the platform asks you if you want to receive daily notifications of how you are tracking against your budget. For many people this is an invaluable reminder which allows you to enjoy your holiday without blowing the rest of the year.

2. Proactively find inexpensive things to do: We can fall into ruts where the only things that are entertaining cost money. The reality is that there are many fun, and rewarding, things to do that are inexpensive or free.  Like what, you ask? Volunteer at a soup kitchen, cook a meal with friends rather than go out- or throw a potluck dinner. Play board games with your family. Walk on the beach. Stroll through the center of town and window shop. Go for a bike ride. Check the newspaper for free events in town- summertime is packed with free events, like outdoor movies, concerts or street fairs.  

3. Think forward: the summer is short- it is already half over. Focusing on how the decisions you make today impact the things that you want to achieve- what matter to you most- is key. It is often challenging to know how best to allocate your money - between spending, saving, paying down debt, or investing. It is also hard to analyze how one decision- like having a baby or paying for college for your kids- will impact your ability to start a business, buy a home, or retire well. Finding the right tools to help understand these tradeoffs and make the right decisions for you is critical. Pefin enables users to simply and easily understand their financial situation today and in the future to make the best decisions possible.

The summer is a wonderful time to enjoy beautiful weather and vacations from school, but it shouldn’t be a time to break the budget. Let Pefin help you achieve what matters most to you!  #DoLife!

 

 

 

Jay Gopalakrishnan