Spend Responsibly

Festivals are expensive and seem to be getting more expensive by the year. Occasions that used to need only a few thousand rupees now cost a lot more and celebrations are gradually becoming unaffordable for the middle class.

Much of it is because of inflation and the rising cost of goods but some of it is also because of our own extravagant spending habits. We forget the adage ‘Cut your coat according to your cloth’ during festival times and tend to spend during religious festivals like Dashain and Tihar and social festivals like weddings and birthdays.

While this may bring us momentary joy, such overspending can cause us great pain in the long run. So, with Tihar just around the corner, it might be good for us to tighten our belts and become thrifty to ensure that we do not find ourselves in poverty for the rest of the month or year after it. And one of the best ways to do it is by making a budget.

Budgets help control expenses by outlining the amount of money at your disposal and the things you need to spend it in. This prevents unnecessary purchases and wasteful lavishness. Setting a budget gives you an idea of your financial situation and gives you control over your expenditure. 

It also helps you get things done in advance because you will have figured out the things you need to acquire and the items you need to spend money on beforehand. Remember, you have obligations beyond the festivals so do not spend everything you have in Tihar or Chhath. Impractical grandeur benefits no one.

After formulating your budget, make sure to stick to it too. Do not get carried away by the so-called festive offers and discounts going on everywhere. Also, be careful when using online or card-based payments. Many studies have shown that when we do not handle physical currency, we lose track of the amount we spend and end up spending more. We are more aware of a huge wad of bills leaving our pockets than we are of digits on a screen. So, either write down all your expenses or set limits on your apps so that you do spend more than your desired amount. You can also contact your bank to impose limits on your credit or debit card payments so that you cannot spend more even if you want. But ultimately, if you feel you cannot restrain yourself in the shopping mall, best not to pay with cards or apps at all and just use cash. 

Another thing one must do to avoid overspending is to strictly say no to borrowing. Any spending you do during festivals must be of your own money and not of that borrowed from friends and family. It is not wise to loan cash from the people around you for celebrations because that money does not go to anything productive. 

You spend that money on things that have little long-term value. Also, asking for money for frivolous things now may make it awkward or difficult to ask for it for actually necessary things later. 

And it’s not like borrowed money adds to your income. It has to be paid back at some point in some way. So, avoid loans whenever possible.

And it is extremely important that you do not borrow from banks or financial institutions because when you pay such loans back, you not only pay the amount you took but also the interest on it which puts you at a net loss and puts a financial burden on you and your family.

But if you absolutely have to, then make sure that you borrow from legitimate banks with legally-fixed interest rates within the full purview of the law. 

Never go to loan sharks and dodgy cooperatives. Also, try to avoid the ‘buy now, pay later’ or other equated monthly instalment (EMI) schemes shops may offer because they also charge interest and make you buy expensive things you do not need.

So, only use the money you have to buy the things you absolutely need and keep the festivals simple.

And very importantly, prioritise your purchases. Focus on only buying the things you need and look for luxury items only if your budget allows. Never buy something only because your peers have bought it and do not make purchases of items just because it has a discount.

So, this Deepawali, make a proper financial plan and stick to it to avoid difficulties later. Make a budget, follow it, do not borrow and do not shop under peer pressure to keep your wallet healthy.