Author Katrina Shanks, CEO Financial Advice NZ Article originally published in

It’s here again. That time of the year when we have just put probably the two biggest spend-ups behind us, only to have the biggest temptations dangled in front of us mere days later.

First there was the spending on Christmas gifts. A recent survey revealed an average person expected to spend $623. Women said they expected to spend $566 and men $712, with people between 35 and 44 years of age $776 and those over 55, $445.

Then came Christmas lunch. I worked out a typical menu for Christmas dinner for a table for six. The first, which had some very good wine and several main meal and desert options, came to $348. The second, after trimming the options and changing supermarkets, came in at $172, for still a very good meal.

Now it’s the Boxing Day sales and all the temptation they throw up, and the danger they pose to our budgets.

And it’s a danger, as can be seen from data from last year.

In the six weeks up to Christmas, shoppers spent a record $5.2 billion at retail stores, and nearly $100 million on Boxing Day, according to Worldline.

Though there are predictions the numbers could be lower this year following the Reserve Bank’s calls to curb spending in an effort to lower inflation, that temptation is still here, because Kiwis love a bargain.

And if we don’t have cash in the bank, we do still have our credit cards, right?

But as inflation increases and our dollar doesn’t stretch as far as it used to, impulse buying can be a bigger problem for our day-to-day budgets. It could even throw our plans for next year into disarray.

And the allure of those great deals on Boxing Day can feed into that.

It’s not so bad if you have your eye on one or two things and stick to it, but where Boxing Day can cause a big problem is when you go into a store and get dragged into buying something you didn’t intend to buy.

If this impulse spending is a problem for you and your budget, then it’s probably time to take a close look at how you can get your finances back in order.

The first thing you should do is understand why you spend impulsively and when you do it.

We all have different reasons, but studies show one thing; spending of any type can give us a huge hit of dopamine, the chemical in the body that plays a big part in how we feel pleasure.

It’s after we’re stressed about something that we’re at our most vulnerable. Impulse spending makes us feel a bit more protected and comfortable. It’s something we do for ourselves to feel better or maybe just not as bad.

We need to be aware impulse spending is not just that special trip you make somewhere but when you add unplanned or unintended spending.

Once you’ve got an idea of why you do it and when, then you need to look at ways to lessen the chance or remove the temptation.

The first thing to do it to check your budget to make sure you can afford it. It’s always a good idea to set a budget for this time of the year and to make room in it for Boxing Day indulgent spending.

Be really strict with yourself. Identify exactly what you want and stick to it. Don’t get lured into something else you see in the shop.

Put time between you and your spending. Even if it’s only a couple of hours. Check it out, check your budget, then go for a coffee or a bit of window shopping. If you’re still keen and can afford it then maybe it was meant to be.

The key question to ask is, is it really a good purchase?

I am the first to admit I love a good sale and sometimes come away with not one purchase but multiple purchases. This year you will see me avoiding sales altogether and taking a walk with family instead.

I’m trying to reduce my consumerism but more importantly know my weaknesses!

However, as my financial adviser would say if you really do need to buy something, use cash where possible. If you have to put it on credit, pay it off as fast as you can, or at least don’t miss a repayment schedule.