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All Work and No Play...

Work, Work, Work.

It can feel like all you do is work hard to make money, which you immediately spend on food and paying off your debt. It is repetitive and boring.

That’s why the end of year can be so much fun. It’s a time to break the cycle, relax, celebrate, and enjoy a change from the daily grind. 2024 has not been an easy year for many of us, and after months of working hard, it’s natural to want to have a little fun and embrace the holiday season.

You deserve a break, a change in routine, a little fun.

Don’t Go Nuts

For many people, the end of year relaxation mindset can unfortunately result in financial risks.

Overspending in December is incredibly common. Good spending habits throughout the whole year can disappear in a moment of weakness. People kind of go nuts and spend, spend, spend. It’s easy to get swept up in the excitement of Black Friday (end of November wildness and December Holiday gift buying madness).

If you are in debt review and are reading this, then you might recall times when you nearly burnt out your credit cards swiping so much in December.

Ahh…the good old…bad old days.

The December Debt Review Challenge

For people in debt review, this time of year can be particularly challenging, with even small missteps threatening to derail months or even years of progress.

The holiday season brings with it, a couple of unique challenges i.e. early salary payments.  Most employers pay staff earlier than usual in December to accommodate early office closures or public holiday time off.

”Having extra cash in hand earlier than expected can be tempting, especially when you’re surrounded by holiday sales and social pressures to spend’

While this may seem like a bonus, it can create a tricky situation. Having extra cash in hand earlier than expected can be tempting, especially when you’re surrounded by holiday sales and social pressures to spend. For those in debt review, this is a dangerous trap, as spending money reserved for debt repayments leads to serious consequences.

Debt repayments under debt review are not flexible.

These payments are set out in a court order, and missing even one of them, can lead to a total breakdown of the entire plan.

Some people reason that they will pay less now and then catch up in January, that is dangerous thinking. You cannot underpay one month and catch up another, the moment you miss a payment or short pay, your creditors can withdraw their agreements, and the progress you’ve made can unravel super quick. This could mean going back to square one (PLUS interest), and that can be financially devastating.

So, how do you stay safe?

Do This For December Success

One way to avoid this pitfall, is to make debt repayments your first priority when you receive your early December salary.

If money for your debt review is paid across to your Payment Distribution Agent (PDA) immediately, then it removes the temptation to spend it. This simple, proactive approach ensures your obligations are met, leaving you free to enjoy the holidays with what’s left over.

It’s wise to talk to your Debt Counsellor now, about adjusting debit order dates.

Many of people who have successfully completed the entire debt review process without messing up, do this each year. So, join the club and tilt the odds in your favour.

An Instagram December

Instagram and TikTok can present you with images of others who are having a great time in December.

Due to the nature of social media, it can feel like everyone is out spending and buying gifts. It can feel like a crushing wave of images of people around you heading out to exotic vacations and expensive dinners.

Of course, that’s just social media. It gives you tiny glimpses into hundreds of peoples’ lives in a few minutes. You won’t ever see the credit card bills and interest on all their spending. So, be sure to take it with a pinch of salt.

Some people even find it wise to scale back on how much of that type of content they follow or consume during this time period. The festive season creates a lot of social pressure to keep up with others, it’s natural to feel left out if you’re sticking to a stricter budget. However, it’s important to remember that the joy of the holidays isn’t tied to how much money you spend, focus on creating meaningful experiences with loved ones rather than trying to match what others are doing.

Plan Ahead Now

If you fail to plan then you are planning to fail.

So, think ahead to the end of year and how you are going to handle things.

Setting clear spending limits is an effective way to manage December finances. Decide in advance how much you can afford to spend (after meeting your debt obligations) and stick to that plan. This might mean scaling down gift-giving ,or opting for more affordable ways to celebrate, especially if this is your first December in debt review.

A few minutes on Google can give you lots of great ideas on how to have fun for less this year, make a plan and stick to it.

Danger Ahead

December is like a sharp curve in the road of debt review.

If you do not make some adjustments, you could easily go off track.

So, why not speak to your Debt Counsellor about shifting your debt review payment date earlier this month?

Why not sit down and plan out a December budget, so you have a plan rather than just spend yourself out of debt review?

The end of year is a great time to slow down and take it easy – time with family and friends, but it should not be a time of year that puts you in danger financially.

So, be wise this year, think ahead and stay on track.