The New Year is a time when people start fresh, set new goals, feel motivated to change, and leave the past year behind. But if you’re experiencing a post-holiday spending hangover, it can be difficult to think about starting fresh. Suddenly your credit card bills are due, your chequing account is empty, and the anxiety you’ve been ignoring comes back with a vengeance. If you’re like me, you also begin the shame spiral, beating yourself up for being so impulsive or not planning better. 

We often view the holidays as a time to indulge and celebrate, which can lead to spontaneous spending and purchases we later regret. According to CBC, Canadians’ spending over the holidays was forecasted to be about $1,478 per household. In Alberta, another study found that 74% of respondents reported impulsively buying holiday gifts for others. So if you’re feeling overwhelmed or anxious looking at your bank account right now, it’s safe to say that you’re not alone.

Why impulse spending is heightened during the holidays 

The emphasis on gifting around the holidays creates pressure to overspend in order to keep up.  Companies take advantage of this time by pushing sales, limited-time offers, and festive branding. But for many of us, our holiday spending is rooted in the desire to treat our loved ones, or to create a memorable experience, and that’s nothing to be ashamed of. You can still offer yourself compassion while recognizing that you’d like to adjust your spending habits moving forward. 

I created this spending recovery guide to help you manage the aftermath, refocus your finances, and set yourself up for the next holiday season.

Step 1: Review and reflect on your holiday spending

As hard as it can be to look at the numbers, it’s important to understand exactly what you’re working with. Take some time to review your holiday spending to see where your money went. Reflect on the following questions:

• What purchases were intentional versus impulsive?
• What categories did you overspend the most in?
• How much did you spend in total during the holiday season?
• What would you like to do differently next year?

If you want a place to start, check out my holiday spending bingo video.

Step 2: Curb your impulse spending

Currently we are in the thick of New Year’s resolution marketing campaigns which can prolong the temptation to impulse spend. So here are some quick tips to hit the brakes on impulsive purchases:

• Unsubscribe from marketing emails
• Remove your credit card info from your web browser & Apple Pay
• Delete tempting takeout apps like SkipTheDishes
• Use a separate spending card for fun money
• Pause before you buy and ask yourself: Do I need this? Is this in my budget? 

Step 3: Set goals

It’s much more enticing to stick to a budget when you have specific financial goals you’re working toward. Maybe you want to pay off holiday debt, save up for a vacation, or max out your TFSA. Write down some clear, actionable goals for the next year and revisit them throughout the year to keep you motivated. Bonus tip: create a vision board that visually displays your goals and hang it somewhere where you’ll see it everyday (see the guide for examples).

Step 4: Create your recovery plan

At this stage you have a clear idea of your starting point, as well as where you want to go in the future. The next step is to create a plan that will help you recover from holiday overspending and get you on track to achieve your goals. Prioritize which payments or bills need to be made first. If you went into debt over the holidays, spend some time creating a repayment plan for yourself. Take advantage of the extended return policy from brands and return any of your unnecessary purchases. Use ATB’s budget worksheet to create a realistic budget that will help you achieve your goals. 

Step 5: Engage in a low-spend challenge

Engaging in a low-spend challenge is a great way to reset your finances after the holidays, and help recuperate any money spent. Unlike no-spend challenges, where the goal is complete restriction, the goal of a low-spend challenge is to reduce non-essential spending but not completely avoid it. 

For example, you might decide to cut back on ordering take-out and buying new clothing for one month. Your exceptions could be things like new socks, or clothing that you need to replace. You might monitor your progress daily using a calendar or a habit tracking app (For digital ones: Habitica is a fun gamified habit tracker, I also like Notion. I personally love color in habit trackers, which you can find free templates for on Canva, or draw your own!). The goal is to bring more intentionality into your spending decisions. 

Step 6: Set yourself up for next year

It’s never too early to start planning for next year’s holiday season! Based on how much you spent this year, use those numbers to create a budget for next year. Open a savings account specifically for holiday spending and set aside a small amount per month. If you put away $50 per month, you’d have $600 set aside to spend next December. Bonus tip: set up automated transfers into your savings account so you don’t even have to think about it.

Remember, you’re not alone in feeling the post-holiday spending anxiety. Take a deep breath, and focus on tackling one step at a time. By implementing these tips you can take back control  of your finances and create a different experience next holiday season.