Make the Most of Your Lunar New Year Gifts with These Tips
By Qunnie Lin
Since I was a kid, Lunar New Year has always been one of the holidays I most look forward to. As an Asian American, it’s like having two Christmases. It’s that time of year when everyone – friends, family and neighbors – gathers together. Lunar New Year is one of the most important holidays in many Asian cultures – a time of celebration, reunions, traditional foods, and often, red envelopes. However, this season can also be a time of increased spending, with decorations, new clothes, gifts and more.
If you think you went a little over budget this festive season, chances are you’re not alone. As Lunar New Year celebrations come to an end, take a moment to reflect on what the Year of the Dog might mean for your finances, and how your red envelope gifts can help jumpstart improved financial habits to reach your goals.
Reset and save
If you receive red envelopes this year, use these financial gifts as an opportunity to improve your personal financial standing. I remember whenever I would receive red envelopes, my parents would always tell me to save it in a piggy bank instead of spending it. The New Year can be the perfect time to refocus your goals for the year ahead. Begin by assessing your fixed expenses – rent, utility bills, car payments, etc. – as well as existing debt. This will help prioritize how to best use your extra cash.
After taking a look at your finances, consider putting aside some of your gifts toward your savings. Do you have an emergency fund? Are you currently contributing to a retirement fund? If the answer to these questions is "no," or even "sometimes," evaluate how you can integrate savings into your overall financial plan moving forward.
Balance your Lunar New Year splurges
It’s only natural to spend during this festive season, but what’s important is to establish healthy and balanced spending habits. Don’t feel like you have to restrict yourself – the key here is budgeting. Take time following Lunar New Year celebrations and gift giving to evaluate and understand where your money went this season. Do you have an established budget? Do you keep track of your spending habits, perhaps using a budgeting app or even an old-fashioned pen and paper? These are important financial foundation builders and this is a great time to put these strategies in place to help ensure you’re making your money work for you.
Grow your fortune
After addressing saving and spending as your financial fundamentals, consider investing a portion of your financial gifts in order to help you reach long-term goals. Look into financial strategies for college savings, such as a 529 plan, or begin contributing to your 401(k). Meeting with a financial planner can be a great place to start when looking to make investment decisions that can help grow your money in the future.
Share your gifts
The festive season is also the season of giving. Your goals and values are an important guide for your budget. Once you’ve achieved a level of personal financial security, consider sharing your financial gifts. You may want to begin thinking about passing down your legacy. Instead of spending your financial gifts, you can build assets as part of your long-term financial strategies that can then be passed on to the next generations.
A prosperous new year
As the season comes to an end, take steps to feel confident about reaching your personal short- and long-term goals. By using these tips and strategies, you can start the year off right with a solid financial foundation for this year and years to come.
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