PFT #74 - Personal Finance Tip of the Week: Planning for Gifts in the Monthly Budget

This week’s topic is about planning for gifts in your budget.

Right off the bat, think to yourself and ask when is the last time that I purchased a gift for someone.

More than likely it has been in the last month. If not, that’s what most people average over the course of a year.

When we think of gifting, it is often for the end of year holidays or birthdays; however, it goes way beyond that.

Let’s think of other major events for most people to recognize such as Valentine’s Day, Mother’s and Father’s Day.

From there, typically there is a cost for hosting or attending events related to the 4th of July, Easter, Thanksgiving, Memorial and Labor and Halloween.

Lastly, don’t forget housewarming gifts, weddings and showers, high school and college graduation and anything else that I did not mention.

Okay, now that we have our finger on the pulse or the “purchase button” on Amazon, gifts really begin to add up.

The good is that this is easy to solve by simply creating a “gifts” budget. Create a spreadsheet and list who and what you are buying for and attach a cost.

Once you have achieved a total, divide that by 12 to create an average monthly cost. In the months that you are under budget, store that money in a separate account and that surplus will be available in the months that are higher in cost.

The bottom line is that gifts are hidden expenses in the budget that often get overlooked.

The positive thing is that when you budget this way, it is almost a certainty that you will spend less from here on out relative to what you have spent in the past - and this is because you get a clear picture on what you want to spend rather than what you’ve spent in prior years.

Website:

https://www.somethingonmymind.net/

Social Media

https://www.instagram.com/somm.podcast/

https://www.youtube.com/channel/UChec5qcZBcGkIhUU3belNDw

https://www.tiktok.com/@somm.podcast?lang=en

https://www.facebook.com/somm.podcast

https://twitter.com/Somm_podcast