The festive season in India is a time of guilt-free spending. Amid all the lights, colors, parties, and pujas, it is difficult not to allow yourself and your family the indulgence that we all wait for all year round. Some of us are waiting to make our big aspirational purchases, some of us spend on clothes and jewelry while some others are rearing to go on the long-pending holiday. Echoing this sentiment, a recent industry survey revealed that festive spending in India could hit $32 billion.

Among such euphoria, it is easy to get over excited and over spend during the festive season. While using various credit options are a great way to phase out the festive spends, one needs to be mindful of the way they borrow, the tools they use to fund their festive spends. Disciplined spending is a virtue that comes with practice, but a few tips and information can help you start the journey.

Budget your festive expenses – India is unique when it comes to celebration as our festive season starts from August and goes on till December, spanning around one-fourth of the year. While everyone gets excited to spend on all festivals, it is important to understand which ones are a priority for you and your family and budget in advance for each festival. For aspirational purchases, it is a good idea to buy during big festivals like Diwali which brings along some attractive discounts and cashbacks. In case you are low on liquid cash, using credit platforms are a good idea to make the most of the limited period offers. However, be mindful that you do not cross your budget by a large margin, even if you are buying on credit.

Also Read: Where to invest this Diwali to light up your finances

Do not forget to maintain your credit score – One of the most important tenants of using credit over the festive season is ensuring that your credit score never suffers. During festivals we receive multiple calls from different credit platforms or end up searching for multiple loan providers. Most of us are not aware that this might impact our credit score. Also, it is a good idea to use only 50-70% of our available credit limit on digital platforms of credit cards and at no point over-spend beyond the limit.

Using multiple credit options with a combination of lending apps and credit cards can be good way to stay within credit limit. Some of us might get swayed away by the prospect of getting things on EMI. In that case remember the thumb rule that your EMIs should not exceed 30% of your in-hand salary. Another quick way to build your credit score would be to make small purchases through RBI-approved digital lending apps and repay them responsibly to build a good credit score.

Delaying gratification- Let’s be honest -The highlight of any big festival like Diwali or Christmas is that extravagant gift we give ourselves or our loved ones. The gaming laptop your brother has been hinting at, the bike you have been eyeing for a year, the diamond set you know your wife would love or the long-awaited trip that you want to take with friends. Remember to phase out spending and delay the gratification to the next festival or next big bonus cycle. It is not necessary to have a big Christmas party followed by a holiday. Cut down on that party and choose your holiday or delay your holiday for the summer break. Doing everything at once and borrowing huge amounts will lead to bad spending discipline. While delaying spending, do your research. Certain consumer electronics, furniture etc. might be cheaper during festivals, while travel is usually 1.5 times more expensive during the same time owing to high demand.

Don’t touch your investments – The pressure of spending during festive season might really take a toll on us and often push us to break our investment instruments like fixed deposits, recurring deposits or ongoing mutual funds. Prematurely withdrawing any investment should not be an option. It is more prudent to use simple digital lending apps to make purchases and paying back on time rather than incurring costs for withdrawing investments before time.

The Indian festive season is always a time of great joy and social significance for all of us. Planning in advance, budgeting for festivals, and being mindful and aware about different financial tools and rules will help you have a joyous festive season without adding financial pressure to the rest of the year!

(By Neha Shivran, Chief Data Officer, RING)