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4 surprising ways to avoid overspending this holiday season

Click to play video: 'Six in 10 Canadians are likely to overspend this holiday season: survey' Six in 10 Canadians are likely to overspend this holiday season: survey
WATCH: Six in 10 Canadians are likely to overspend this holiday season: survey – Nov 22, 2018

The holidays have gone from merry to miserable for many Canadians, a slew of recent consumer surveys show.

Sixty-one per cent of Canadians find this the most stressful time of the year, according to a report by financial comparisons site RateHub.ca. And one-third of shoppers say buying gifts is more nerve-racking than five years ago, reads a poll by UPS Canada.

READ MORE: How much Canadians across the country plan to spend this holiday season

The root cause of the problem is likely the disconnect between what we would like to do with our money and what we actually end up doing.

Eight in 10 Canadians say the season has become too focused on spending, according to a recent poll by Manulife Bank of Canada. Yet, 60 per cent of holiday shoppers say they are “prepared” to go into debt.

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It’s what financial planner Shannon Lee Simmons calls “unhappy spending.”

It’s money that “doesn’t give us a very high emotional return on investment,” said Simmons, founder of the New School of Finance, a Toronto-based financial advisory firm and author of Worry-Free Money.

Maybe it’s the $50 you dropped in gift cards for your kids’ teachers because “everyone is doing it.” Or maybe it’s the $200 you spent on a new pair of shoes because “you deserve it” — even though you know you can’t afford it and are going to regret it later.

Whatever it is, the financial key to holiday merry-making is to identify and reduce your sources of unhappy spending, Simmons said.

WATCH: This is how much Canadians across the country are planning on spending during the 2018 holiday season

Click to play video: 'This is how much Canadians across the country are planning on spending during the 2018 holiday season' This is how much Canadians across the country are planning on spending during the 2018 holiday season
This is how much Canadians across the country are planning on spending during the 2018 holiday season – Nov 19, 2018

Here are four tips to help you do that:

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Weed out unhappy spending from your gift list

“Make a list and check it twice” is only half of your holiday gift-giving prep, Simmons said. The other step is to identify which items you will feel excited and happy to spend money on and which will make you feel frustrated and resentful.

“You know that there are going to be certain social obligations that are coming at you … where you just feel like you have to fall in line,” she said. That’s where you need to try to reduce your spending.

WATCH: 2 ways to get a bang for your buck this Black Friday if you buy from the U.S.

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2 ways to get a bang for your buck this Black Friday if you buy from the U.S – Nov 17, 2018

Speak up about expensive holiday traditions

One client Simmons is currently working with is feeling very stressed out about an upcoming family reunion that usually features gift-giving for 10 nieces and nephews. This usually turns into an expensive guessing game, where the client will fork out around $250 for something that won’t necessarily match the kids’ — or their parents’ — taste.

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A surprisingly effective way to tackle that kind of social pressure is to speak up about it with family and friends, Simmons said.

READ MORE: 12 Secret Santa gifts under $30 that your co-workers will actually like

Usually, no one says anything because they don’t want to look cheap. But “if you are brave enough to say, ‘is anyone else feeling crushed by this financial scenario,’ you’ll be surprised by how many people will say, ‘oh my gosh, me too.'”

Those conversations usually lead to new and more affordable traditions, like Secret Santas, gift exchanges, or donating small amounts of money to nieces’ and nephews’ registered education savings plans (RESPs).

“It’s not like no Christmas or no holidays, it’s just — less.”

WATCH: How to avoid impulse spending this Black Friday

Click to play video: 'How to avoid impulse spending this Black Friday' How to avoid impulse spending this Black Friday
How to avoid impulse spending this Black Friday – Nov 25, 2016

Volunteer with your kids

Meeting your own children’s expectations can be the biggest sources of anxiety for parents. The pressure to live up to whatever other parents are doing for the holidays is real.

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The key is to give your kids another point of comparison, according to Simmons.

READ MORE: 13 holiday gifts that give back in 2017

“Volunteer with less fortunate people and take the children,” she said. “For a lot of the families I worked with, it helps change the conversation from ‘look what my friend got,’ to ‘I am so lucky.'”

Look for things like toy drives, food drives or opportunities to work in seniors’ residences, Simmons advised. And try to keep it local, she added. The psychological switch for kids tends to happen especially if they can see what’s happening “just down the street.”

WATCH: How to shift kids’ focus from getting to giving over the holidays

Click to play video: 'Family Matters: How to shift kids’ focus from getting to giving over the holidays' Family Matters: How to shift kids’ focus from getting to giving over the holidays
Family Matters: How to shift kids’ focus from getting to giving over the holidays – Dec 21, 2017

Temporarily remove your credit card information from online retail sites and apps

But unhappy spending isn’t just other people’s fault. Overindulging can feel just as lousy when you’re spending on yourself.

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A simple strategy to reduce that tendency is to do away with the fast online checkout option at the start of the holiday period, Simmons said. Remove your payment information from all your favourite retailers and apps and don’t add it back until the next year, she suggested.

The extra step of having to, say, get off the couch and get your credit card, is often enough to deter most impulse buys.

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