Need a home tutor?

Call Mr. Fameso on 07062173272

Saturday 22 December 2012

Avoiding Overspending this xmas


The Yuletide is usually associated with indulgences. However, experts warn against the temptation of overspending during this season. 
One of the major complaints during the Yuletide season is overspending. Experts say it is the easiest mistake to make at Christmas, if for no other reason, at least for the simple joy of giving. Most painfully, they lament that consumers overspend, often buying things they hardly need.
Though people want to stick to a budget, more often than not, they discard it and find themselves regretting the amount of money they spend at Christmas.
In spite of the seemingly widespread saving culture among Nigerians, as confirmed by the Access to Financial Services in Nigeria Survey conducted by EFInA in 2010, experts lament that many Nigerians still throw caution to the wind during Christmas and other festive seasons. Beyond food, clothes, gifts, decorations, and cards, experts say many consumers in the country go on a spending spree, buying things they could enjoy the season without. 
The EFInA survey had discovered that the culture of income saving is widely common among Nigerians, whether banked or unbanked. For instance, 52.8 million adults, representing 62.3 per cent of the country’s population, is saving part of their incomes. Specifically, 28.5 million men (65.7 per cent of the adult male population) and 24.3 million women (58.8 per cent of the adult female population) are found to be saving part of their incomes.
More succinctly, the report stated that 40.5 million Nigerians currently save for emergencies;  20.9 million for day-to-day ordinary household needs;  15.1 million for school fees; 12.1 million for personal needs; 10.7 million to expand businesses; and 8.9 million to take care of old age. Another 7.9 million Nigerians are said to be saving for medical expenses, while 7.6 million save for home improvements and 6.5 million for starting a business.
In spite of this, however, many consumers in the country are belived to be at risk of overspending during festive seasons and jeopadising their savings. In view of this, experts warn that spending can get out of control if caution is not exhibited and this, according to them, can leave many families financially worse after the holidays.
Warning consumers against overspending and impulse buying, the Chief Technical Officer, Digital Encode, an indigenous information security company, Mr. Oluseyi Akindeinde, opines that the biggest gift anybody can give himself during any festive occasion is ‘restraint.’
The reason people find it hard to show restraint in shopping during the Yuletide, according to him, is the intense social pressure to go out and spend at such time of the year. He adds that proper planning and budgeting must be embraced to avoid spending what consumers don’t have.
Akindeinde says, “Just like any other aspect of life, there is a need for planning and budgeting during any festive occasion. Without this, one would run the risk of overspending, thereby having little or nothing in reserve to pull through the following months. The best advice I can offer to families who want to remain buoyant after any festive season is to avoid the temptations of buying more than they can actually afford and always make sure everything sticks within a pre-planned budget limit.”
“As for the gift list, families should generally include only the persons that matter most to them. For the people they work with and for any other similar categories all that is needed is to bring some homemade delicacies. They will not have to worry about purchasing expensive gifts for everyone. Ideally, they must also learn that they can’t and indeed shouldn’t buy gifts for everybody.This is simply not the point of the entire holiday,” he adds.
The Deputy Manager, Cutler Ogilvy, a Public Relations company in Nigeria, Mrs. Funmilola Abiola-Odutola, says it is possible for families not to go broke after a festive season if there is proper planning.
“It is good people draw a budget and try  to spend within that budget. Christmas spending should not be based on impulse. The budget is supposed to have been drawn since the middle of the year. Another means of savings during this time, is to look out for where there is sales,” she notes.
The Company Secretary, Ipsos Nigeria Ltd., a market research firm operating in Nigeria, Mrs. Olajumoke Opemuti, says it is considered a ‘norm’ for people to ‘pamper’ themselves during Christmas and New Year season, but warns that it is wise not to over-shoot the budget.
She says, “Christmas is a period when you have to fit into the crowd, for example, buy new clothes for the children, buy new gadgets, and buy new dresses, among others. However, it is also wise that before this period, you should be able to save at least 50 per cent during the year to celebrate Christmas and so any money got at the end of the year should be used in January. If you do not make saving a habit, you may be owing debts for the rest of the year.”
Opemuti urges families to ‘cut their coat according to their cloth,’ adding, “if you dont have much, spend the day with your family instead of jumping from one concert to another. However, if you are very rich, enjoy every penny!”
The Chief Executive Officer, RoyalePrestige Properties, Mr. Seun Akinyele, advises that consumers should be goal-oriented and frequently remind themselves to keep their spending reasonable during the season.
Alexandrea Wilson, writing on www.temecentre.org, gives requisite tips for controlling and avoiding overspending at Christmas.
Wilson, who encourages consumers to actually set a Christmas budget, says, “So many people say they have gone over their budget during Christmas but you won’t believe how many people don’t even have an actual budget.  I’m not just talking about including Christmas shopping in your already normal budget, but I’m saying create another budget specifically for Christmas.”
He encourages consumers to shop for all their Christmas needs in one sweep.
He says, “Instead of doing your shopping all over the place, pick a day and do all of your Christmas shopping in one day or two. This way, it’s all complete and you don’t have to worry about it and you’ll be less likely to keep shopping for people when you’ve already bought enough for them.”
Wilson further advises consumers to limit the gifts they give out, saying, “If you really don’t have the money to buy everyone you know a gift, then don’t. Don’t give in to pressure when you don’t have the money.
“God wants us to be good stewards of our money and so we don’t need to overextend ourselves if we just simply cannot. Buy gifts for your close friends and family or just your family. And you can make gifts for your others or just send cards to everyone’s home.”
He explains that consumers should avoid shopping with friends, adding that this may cause more problems as people tend buy things just because they are with their friends shopping.
Experts warn against impulse buying during Christmas, saying it is one of the reasons why people go out of their budget and end up regretting.
In a rather different dimension, however, the Public Relations Officer, Joint National Association of Persons with Disabilities, Lagos State Chapter. Mr. Dare Dairo, condenms the usual price hike at Christmas, urging the government to consider measures, such as price control to ensure that shoppers buy at reasonable rprices.
He says, “Abroad, Christmas sales means cheaper prices. But in Nigeria, it’s the reverse: people jerk up prices on goods and services during Christmas and other festive seasons. That’s why there are lots of road accidents because commercial drivers want to reap maximum gains from the criminally high fares as more people travel to spend the holiday with their loved ones.
“We need a re-orientation of the people and a strong price control mechanism to tackle the problem. Besides, the government needs to provide viable and cheaper alternatives to force down the prices during these seasons.”

DAYO OKETOLA 

No comments:

Post a Comment

Please comments are invited