By Sheila Walkington, Co-Founder and CFO Money Coaches Canada
There is something about summer that makes us loosen the reins on our routines. We tend to eat more treats, and we let the kids stay up later. We enjoy more time with friends. We travel. We garden. We relax. We do the things there wasn’t time for when the days were shorter and colder.
Summer makes us feel like we owe it to ourselves to have a good time; before winter rolls around again. That can mean we loosen the grip on our spending too. It’s very easy to adopt the; “I’ll get back on track in September” attitude, which can significantly impact your financial goals.
Does that mean fun and spontaneity are off the table this summer? Not at all! Here are my suggestions to make this summer, and summers to come, memorable without breaking the bank.
Stay Engaged with Your Spending
Financial engagement is my number one suggestion for summer, and all year round. One of the prime reasons people overspend is not paying attention to their cash flow. And strange as it may seem, studies have shown that the more money you have, the more likely you are to overspend.
Does any of the following sound familiar?
“Look at those hanging baskets! On sale! Only $20 each. Two in front of the house and four in back on the deck would be so pretty!” ($120 plus tax).
“Do we have any sunscreen left?” From beaches, pools, summer camps, sports fields, hikes and simple back yard BBQs, the average family of four will go through a lot of sunscreen from May to September, (not to mention the bottles that the kids will leave behind somewhere). When you add up the cost of all that sunscreen, add in sun hats, and just inexpensive sun glasses, you’ll likely spend close to $200 protecting yourself and your family from the sun.
That’s just two quick examples; there are so many more – who hasn’t dropped $50 on treats, chips and drinks for an impromptu backyard party invitation?
So what’s the answer? How do you stay engaged? Don’t worry, I won’t say make a budget! (A budget sounds too rigid to most people – we can’t do this, and we can’t do that, it’s not in the budget). But I will say, create a spending and savings plan, if you don’t already have one.
A spending and savings plan is different than a budget, because it’s a plan, not a rigid prescription. A plan is a strategy, and a strategy adapts to circumstances. If you read this blog regularly, or have read our book Unstuck, then you have heard of our spending a savings plan before.
When you have a spending and savings plan, you have thought about what’s important to you and your family. You have taken the time to set priorities—you have short and long-term goals, and you know how much money you’ll need to achieve them. And most of all, you are excited that you can make your goals a reality. You don’t feel restricted, you feel in charge. You know how much money is coming in and you know what expenses are fixed and which expenses are a reflection of your priorities and goals. You know where you have room to adapt. And because you’re always looking at the big picture, you are ready for seasonal expenses and your goals don’t get sidetracked by free spirited (we’ll figure it all out in the fall) summer spending.
But you may be thinking: that sounds great Sheila, but it’s already June, there isn’t time to plan ahead, how can I have fun but not overspend this summer?
To that I say;
Take a Fresh Approach
Sometimes we get so used to doing something one way, that we don’t see other possibilities. For example:
- Do you entertain more in the summer? Pay attention to how much food you prepare, so many of us over-do-it when entertaining. You don’t need thick steaks, three different salads and extravagant desserts. Keep the menu simple. Better yet, make your next event a potluck, and share the expenses. The important part is hanging out with family and friends.
- If you like to eat out with friends, try meeting for breakfast instead of dinner. Your food will be less expensive, and coffee is cheaper than a glass of wine. But if you prefer those warm evenings on a restaurant patio, eat dinner at home and meet for dessert and coffee, or for a shared pitcher of beer or sangria.
- If you are going away, look online for hotel and restaurant deals that can save you money. And it may be worth spending more for a room with a kitchenette if it means you can save money on going out for breakfast or even lunch.
- If you will be home all summer, look at your hometown the way a tourist would. There are often beautiful parks, hiking trails and bike paths that locals take for granted. And the bonus is they are free to use.
- Whether home or away, take advantage of free activities like artisan shows, giant garage sales, antique barns, used bookshops, vinyl record stores (not necessarily to buy anything, but these places can be fun to explore).
- Many museums have family days or discounted times. Pay attention to those little cost savings.
- A daytime picnic with the kids is fun, but a night picnic, with the whole family in pyjamas looking at stars can become a great summer tradition.
- If you will be having house guests this summer, don’t be too polite to accept an offer of help with the grocery costs. It’s nice to be a generous host, but not if it throws your expenses into overdrive.
Another way to increase your summer fun budget is to shift money away from one area to another. For example; we all know how expensive gas is these days, can you walk or bike ride more this summer and redirect some gas money into a fun activity?
Or, what about having a garage sale? It can be the perfect time of year to clean out clutter. Sell small appliances, kitchen gadgets or tools you never use, clothes you never wear, and toys the kids have outgrown. Not only will your house feel more organized, you can have fun chatting with the shoppers and the kids can have a lemonade stand and make a few dollars of their own. At the end, use whatever money you made for a fun family activity. It’s a win-win.
All those ideas are just a drop in the bucket of what you’ll find if you google “free summer fun.” But if you still find yourself wishing for a big family summer trip, or any time of year, you can make it part of your spending and savings plan.
Plan Ahead for Next Summer
Pay attention to all the expenses that come up this summer and consider their importance to you and your family. How much do you want to spend on your garden or deck décor? How often would you like to entertain? Did the kids enjoy their summer camps and activities? Where would you like to get away to? Would you prefer a staycation in the summer and a get-away in the winter? Where would you go? What would that cost?
When you have a list of your priorities and tally up the estimated costs for your travel and summer expenses, you can divide them into 12 and you’ll know how much you have to put away each month, to be on track next summer. (Of course if you are planning a winter trip you’ll have to save over six months or seven months if starting now).
There is a chance that when you do this exercise, you’ll discover that it will be quite a challenge to put that amount aside. Don’t be discouraged. Remember that if it seems impossible with a savings plan, it will definitely be impossible without one. This is the part of the process where you get to decide how important something is to you.
I always suggest that my clients set up no-fee online savings accounts for each trip or savings goal. I even suggest that they give the account a name. When you see money building up in the account named Italy you can feel your goal getting closer. You’ll be less likely to dip into that account for another purpose because you know it not just money in the bank; it’s your dream trip you’ll be delaying.
If you would like assistance developing your spending and savings plan, a Money Coach can help you find the balance that makes sense for your life and goals.