BY Jaryd Brady
The holidays is considered to be “the most wonderful time of the year,” but for many, it isn’t for their wallet. Gallup news reports that U.S. adults estimate that they will spend approximately $885 on gifts this year, slightly lower than 2017’s expectations.
“The best method for being able to maintain focus on the solutions above is to have a plan and sticking to it, “Merrill Lynch wealth advisor, Nick Carr, said.” If you know you are bound for success by sticking to the plan, why go ‘off-road?.’”
One issue that arises every year, is a lack of preparation. Between secret Santa, family and other social gatherings, it’s easy to lose track of how much is being spent. Re-balancing your portfolio is the process of re-positioning assets back to the target, long-term model based on your goals and risk profile, ensuring that future financial problems don’t arise in the new year.
“If you don’t re-balance, you may be taking on more risk than you are comfortable with/need to take, causing other behavioral and financial plan problems in the future,” Carr said.
Another overlooked aspect that comes with the holiday season, is credit card debt. Working to lowering the balance of higher-rate credit card debt will improve cash flow and your financial plan as a whole.
“Carrying high-rate cards too long can have a drastic negative impact on both cash flow and overall financial plan,” Carr said. “Establishing an annual routine, both in personal goals and financial, can increase the likelihood of success.”
The best way to start prepping for the holidays, or anything for that matter, is to make a plan and stick to it. The process of staying on-track with your long-term goals will not only help you financially, but give you a better holiday experience overall.
“We tend to “follow the masses,” and in this era of non-stop information, this can be tough/impossible to do,” Carr said. “Just remember, what’s right for another family member or friend, may not be right for you, since everyone has different goals, risk profiles, and personalities.”
Americans will spend a total of 400 million on Christmas this year and having a set annual budget will ensure that money is spent wisely. By knowing what you’re going to spend the most/least on, you can ensure that the financially struggles of 2018 don’t carry over into 2019.
“An out of control budget can lead to financial uncertainty, as well as unhappiness,” Carr said.
© 2018 Naples Herald. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.