(BPT) - It's the most wonderful time of the year, and this season, consumers are prepared to spend extra on festive gatherings, gift-giving and spreading holiday cheer! However, the holiday hustle can also significantly strain financial and mental well-being, especially in today’s challenging economic environment.
"Money can elicit so many types of emotions — from the delight we may feel when a loved one opens a gift we purchased, to the loneliness that may accompany an inability to travel to loved ones or partake in certain festivities,” says Lindsay Bryan-Podvin, Certified Financial Therapist (CFT-I) and Upwise contributor. “So, it's important to recognize how those emotions might influence our spending and saving habits as well as our relationship with money overall.”
For example, a fear of overspending can lead to excessive frugality and cause individuals to miss out on some of the most enjoyable aspects of the holiday season. Meanwhile, others may chase feelings of joy by splurging on gifts, hosting elaborate events, and booking vacations — only to feel regret when a massive credit card bill arrives in the new year.
The leading concern for almost half (46%) of working Americans when considering their top drivers of lower mental health is financial concerns, according to MetLife’s 2022 Employee Benefit Trends Refresh Study. This is even higher for working women (51%) and Gen Xers (52%). On the flip side, 85% who say they are financially well, report feeling mentally healthy.
To keep the holiday season joyful and on budget, consider these expert tips directly from Bryan-Podvin:
1. Understand the emotional connection to money
Emotions like guilt, anxiety and impulsivity majorly influence how we manage and confront monthly expenses. Getting to the root of your feelings about money now (e.g., anxious, avoidant, stressed) is key to understanding how you want to feel about money in the future (e.g., calm, relaxed, confident).
One way to do this is by journaling your feelings about money regularly. Free tools can make this even easier. Upwise is one of the few financial wellness apps that assesses emotions tied to financial activity with its ‘money mood’ tool to help make managing finances more personalized, achievable and rewarding.
2. Make gifting intentional by planning for it
Creating a “gift account” where you can allocate funds over time is an easy but extremely effective way to isolate and stick to a spending amount that fits your budget. To take this a step further, using Upwise’s “Spend Control” feature allows individuals to pick a category (e.g., retail/shopping) or even a specific merchant to track and set spending limits — alerting holiday shoppers to over-spending in real-time and helping them avoid falling too far into the red zone.
3. Eliminate redundant expenses with ease
There are small decisions you can make in the present to get closer to reaching your long-term financial goals. Consider cutting out smaller, unnecessary costs such as monthly subscription services you don’t really use. If you need an extra push to get you started, try leveraging digital tools that allow you to consolidate subscriptions — some, like Upwise, even have fun and engaging challenges like the “Subscription Buster” to motivate you through the process.
4. Celebrate the “small wins”
While it’s great to be ambitious and have lofty aspirations for your financial future, set yourself up for success by establishing reachable goals and celebrating each small win to help create a foundation for a more positive relationship with money. For example, if you struggle with spending too much on dining out or food delivery, try challenging yourself with Upwise’s “dining out challenge,” which will allow you to select from a list of cost-saving actions, commit to those and then track your progress. And when you do succeed at spending less? Pat yourself on the back, text a friend, or open up that kombucha to celebrate.
5. Reflect and recover
If you go beyond your holiday budget, give yourself some compassion (it happens!) and then dig into what led you to overspend. Was it the excitement of seeing loved ones for the first time in years? Feeling you needed to spend the same on everyone? Once you determine why you overspent, you can create a plan for potential spending triggers in the future.
Upwise is a product of MetLife Consumer Services, Inc. Upwise is available at no cost to all individuals and regardless of any MetLife relationship or product. Upwise is for educational purposes. Each individual is advised to consult with their own attorney, accountant, and financial professional regarding their specific circumstances. MetLife does not provide legal, tax, or investment recommendations or advice.