I was privileged to be a guest speaker at this month’s Saccology’s meetup to speak about budgeting for the holidays. Saccology is a community of financial experts who are tired of seeing young people spiral into the “debt trap”. They help you break free from financial stress.

We are in the festive season and in a spending mood. Did you know that we spend 17% more than what we plan for and that this number increases during the holidays? This was one of the most eye opening and informative session I have had this year and I decided to share all that we talked about in a summary form. So how do we budget for the holidays and how do we not overspend?

First of all for us to budget for the holidays, we need to know what a budget is and what it entails. A budget is an estimate of income and expenditure for a set period of time based on a future plan. You can’t budget for the past!The next thing is to know what to include in your budget. This involves four things which are your fixed expenses, variable expenses,miscellaneous expenses and Income.

Fixed expenses

Fixed expenses or costs are those that do not fluctuate from one period to another. for example your rent, insurance,school fees, chamas, loan payments, sacco contributions etc etc.

Variable Expenses

This are costs that change depending on your use like fuel, food, water bills, electricity bills, saloon, clothes, airtime and the likes.

Miscellenous Expenses

The most forgotten expense when it comes to budgeting is this one. We always forget to include this in our budget yet it a very significant element in Budgeting. The small small things we spend money on is what we call miscellaneous expenses. This include the random cocktails you have after work, that new shoe you buy on sale, wedding/birthday gifts, snacks on your way home while stuck in traffic, random road trip etc etc.


Income is money received especially on a regular basis. For you to have a budget, you need to have a source of income. Your budget should always depend on your income.

Where do we get our income?

The main sources of our incomes comes from the following areas;

  • Salaries
  • Side hustles
  • Parents and siblings
  • Money lending apps like Tala, Branch, Mshwari
  • Sacco dividends
  • Debt collection/Rebates
  • Online Betting/Gambling
  • Investments
  • Bonuses and allowances
  • Sponsors

What do we spend on during the holiday?

When budgeting for the holidays, most people always overspend on the things mentioned below.

  • Food (this takes the highest percentage).
  • Drinks (Drinkcember).
  • Transport to upcountry which increases almost thrice the normal price.
  • Relatives in upcountry who think you have come to shower them with money.
  • Unnecessary random trips.
  • Gifts.
  • Extra unplanned for guests.
  • Christmas trees and decorations.
  • Shopping .

How do we stick to our budget?

Now that we already have a budget for the holidays and know what we have in our budget list, the next thing is to ensure that we follow through. How do we do that? This is one of the hardest things to do especially now in December when everybody is in the christmas mood. We came up with some holiday budgeting tips.

  • Have a limit on the amount you want to spend.
  • Track your expenditure. Have somewhere you write all your expenses or download expenditure trackers.
  • Start by paying your big bills first e.g Rent, shopping and utilities.
  • Pay in cash so as to be able to reduce extra charges and also it is easy to track your expenditure.
  • Have a financial accountability partner to keep you in check.
  • Cost share with your friends and family.
  • Learn to say no to unplanned things that will make you dig into your pocket.
  • Attend free events or events that you can redeem your tickets for something.
  • Limit your access to any other money other than what you budgeted for. If possible, deactivate your mobile banking.
  • Delete your shylocks number. Don’t ask for loans.
  • Avoid “keeping up with the Joneses”. This means that avoid copying what other people are doing. You don’t know what their budget is.
  • Stay home. This will actually save you a lot of money. December is the month you set your foot outside the gate and you find yourself in Naivasha spending over 10,000. So stay home and save money.

We have identified our sources of income, done our holiday budget and put down measures on how to stick to the budget limit. What next?

How do you prepare for the New Year?

This is the time to come up with new year resolutions that include better money management and budgeting skills.

  • Pay your big fixed expenses now! You can pay your rent, school fees and the likes now.
  • Develop a monthly budget and follow through.
  • Track your expenditure. Download the apps. Mint, Wally, Clarity Money, YNAB, Mvelopes etc.
  • Pay your expenses in cash to avoid hidden charges.
  • Get a financial accountabilty partner to help you keep your money in check.
  • Have a saving plan. You can try the 52 week saving challenge.
  • Invest. Start with low risk markets like money markets.
  • Do bulk shopping and cost share.
  • Spend less than you earn.
  • Have an emergency fund so that you don’t run into debts from borrowing.

From the above holiday budgeting tips, I hope that our new year is going to be better and we are not going to be in the debt trap. Join the Saccology community today and learn to be financially free here. REFUSE TO BE BROKE!!

Also read; Budgeting/ Expenditure tracking Apps you should have.