Avoiding Year-End Binge Spending

or Why Saving is Like Dieting, part III

During the holiday season, people tend to gain weight.  Between Thanksgiving, with the extra stuffing, gravy and pumpkin pie, through the Christmas parties, boxes of cookies, and champagne at New year’s, it was once estimated that the average American gains anywhere from 1 to 7 pounds during this season.  Although most people  tend to buckle down and pledge to exercise more and eat less in the new year, the cumulative weight gain due to seasonal pounds can really add up over the years.

I find that spending patterns are similar.  For whatever reason, we humans seem to like being programmed by when the moon circles the earth (month – things like rent, mortgages, credit card payments, and loans tend to follow the moon), or by the earth circling the sun (year – we tend to do large budgeting annually).  By year end, most people (including me) are a little burned out from tracking spending, calories, exercise, and all of the things that we try to be more disciplined about.  And, just as the year is nearing a close, so comes the Christmas season which is complete with gift traditions and temptations for purchasing new things.  The combination of seasonal spending and year end burnout, are a powerful comination that can lead to binge spending.  Here’s what I try to do to counteract these temptations:

–I put aside some every month for year end expenses — similar to dieting, the lifestyle changes that can be incorporated every day are the ones that are the most enduring.  I set aside money each month that ends up allocated at year end.  This includes Christmas gifts for friends and family (although that has been reduced substantially), Christmas tips for people that have offered great service throughout the year (in my case the maintenance people for the condo unit and my massage therapist), as well as charitable giving for the organizations that I support.  I keep segregated accounts for various categories with my online bank.

–I minimize temptation — I generally steer away from shopping malls and from keeping lots of catalogs in the house.  Avoiding shopping malls is easy since I really hate parking and crowds at the larger shopping centers.  Now that so much shopping is available online, I have to find a way to eliminate temptations on Amazon as well. Similarly, for food, I keep the high temptation snacks out of the house as well.  Right now, the dangerous items are gourmet potato chips (which are great with hummus or artichoke dip) and chocolate nut clusters.

–In one or two sittings, I decide on the major spending and gift giving — this is sort of like a blowout celebration meal, like a birthday meal or Thanksgiving, where day-to-day prohibitions are not required.  I find that concentrating the gift selection and check writing for charities in a focused way, I can exert my spending energies in one or two rounds. To keep the spending in check, I start with a total amount that is available to be spent and decide from their what items to select.

–I enlist my friends and family — similar to eating healthier, having those around you practicing similar habits is helpful.  Generally speaking, I try to eliminate the excessive gift giving, limiting gifts for small children.  Although simpler living seems to have caught on in some circles, I don’t expect this to necessarily become a widespread trend.  This makes it all the more important to have some supporters around you.

–I keep detailed records so that I don’t accidentally overspend/overeat – I find that keeping track of receipts, recording spending and eating habits helps to cut down on excess.

for previous articles, see Why Saving is Like Dieting, part I and part II

shared at this week’s Carnival of Personal Finance