Avoid a financial hangover this festive season

As consumers become more confident about the economy, the risk of overspending over the festive season becomes increasingly real. For retailers, festive season shopping kicks off around Black Friday and continues through to just before Christmas, after which Back-to-School sales start.

It’s during these times that wallets become exceptionally stretched, with short-term lender Wonga finding in a recent survey that 70% of South Africans expect to spend more than usual over the festive season. Its eighth annual Summer Spending Survey, of more than 10,000 South Africans, found that they plan to spend an average of R6,299 this festive season.

Chief growth officer for BOO! Campus Media Greg Potterton explains that the “Black Friday hangover” hits Gen Z (13- to 28-year-olds) differently. “It’s not about regretting a reckless splurge, but about realising that the money they spent on their coping tools may not stretch into the next month,” he says.

Potterton explains that young people buy items to support their mental and physical health, but often worry they can’t afford to maintain purchases such as gym memberships. “It is a new kind of financial pressure that blends well-being with budgeting, and it is reshaping how this generation defines value and necessity,” he explains.

Shiree Coetzer, a financial adviser at Alexforbes, says the festive season can bring with it added pressure to spend more than usual. She notes that, with bonuses mentally spent before they arrive, the festive excitement, and most people being paid earlier than usual, “you end up with a December-to-January stretch that feels more like 199 days than a few weeks”.

The way to avoid starting the new year with additional debt is to start planning early, says Coetzer. “Your usual monthly budget needs a festive adjustment to include January’s obligations,” she says.Coetzer adds that “budgeting for the holiday season is essential, but consistent monthly budgeting is equally important”.

Hayley Parry, Worth head of education and co-founder, explains that the first step is to protect their debit orders. “What we find often is that, if people have overspent on Black Friday sales or over the December festive season, they allow their debit orders to bounce because there’s not enough money in their accounts.”

Parry explains that this is an issue because products and services such as insurance won’t be active, and people are likely to need them more during the festive season when they are travelling away from home, for example. “Sadly, statistically, we know this is one of the most vulnerable times of the year,” she notes.

Coetzer adds that people need to ensure, as obvious as this may seem, that they start by keeping enough in their account for usual expenses. “Some companies now request permission to debit December month-end expenses earlier than usual, so it’s vital to make sure these commitments are covered,” she says.

Some of the ways to ensure that debit orders are paid are to manage expectations, manage the excess of spending, and manage boundaries, says Parry. This, she says, may mean that some hard conversations need to be had with family and loved ones.“It’s always better to have a conversation up front. And often you’ll be surprised at how grateful people are if you raise the issue with them around how you’re going to be treating gifting for a family gift together,” or determine “who’s bringing what” to a lunch, for example, Parry says.

Coetzer says that, if you’re hosting family, consider creating new traditions that help stretch the budget. “While some families still expect the host to provide everything, many people understand that budgets are tight and that sharing costs makes the festive spirit go further.”

Wonga’s research found that almost a quarter of South Africans have planned ahead and saved throughout the year to cover their festive costs, compared with 26% in 2024. However, this figure is still below the record 42% recorded in 2019, showing that consumers have not yet returned to pre-pandemic levels of confidence.

Meanwhile, 21% intend to draw from stokvel savings to fund their festive spending, while similar figures will turn to credit providers at 22%, up from 20% in 2024.

Parry adds that people should use a weekly spending plan to determine how best to distribute the money they will have left once accounting for debit orders. Variable spending, as she calls it, needs to be spread out over the amount of time left until the next pay cycle.

“People often used to use an envelope system and put cash aside. But that comes with inherent risks. So, I encourage people to use savings pockets in their bank accounts,” Parry says. She adds that this helps provide peace of mind that it is possible to get through to the end of January.

Yet, Wonga senior digital marketing manager, Tina Manyanya, says that people are being more cautious with their money. “While spending is still happening, it’s increasingly strategic; people are saving where they can, spending only when necessary, and using flexible forms of credit to get through the festive season,” she adds.

Coetzer notes that, “careful planning now means you won’t be counting the days until you’re paid again, nor will you enter 2026 with a financial hangover… Let 2026 be the year where you know where your money has gone.”

PERSONAL FINANCE