Munya Shumba, financial adviser at Discovery Limited, has some great advice for those who find their January turning into Janu-worry.

Why is January so often referred to as “Janu-worry”? It’s because in many parts of the world, employees get their salary paid earlier than usual, and for those employees who are fortunate to still receive an annual bonus, their 13^th cheque is paid out in December as well.

So, in the middle of December, most employed South Africans have more money than usual in their bank accounts. They’ve just been paid at the end of November and halfway through the next month, they’ve received another paycheque. What could go wrong?

But come the middle of January, there’s this rampant disease of financial struggle where everybody is singing in unison as they claw their way to January’s payday. How can there be such a 360-degree turnaround in such a short period of time?

My first Janu-worry experience

I recall my first experience as a victim of Janu-worry in December 2008. I was studying at university and working part-time. The company paid their staff early in December to help us plan for Christmas.

However, as a student with a lot free time on my hands, with no lectures and no responsibilities, I spent that time and the “extra” money going out. I didn’t actually have any more cash than I would have had over a two-month period, but I wasn’t used to having all these extra funds all at once and, in my naivety, I started spending more than usual. Exorbitant midweek lunches were follwed by spontaneous midnight parties at the most exclusive bars in Manchester.

There were no alarm bells, because every time I swiped my card, it worked, and I seemed to always maintain a healthy bank balance. This was the case until – well, until it wasn’t.

After the rent debit order went off at the start of January, following a New Year’s Eve celebration to remember, reality hit very quickly when I checked my bank balance. I was staring down a long 31-day barrel to the next payday.

That January was so financially torturous. Even to this day, 15 years later, I remember the pain of taking noodles as my packed lunch to school and work every day, and watching enviously as my fellow students and co-workers carried on spending as usual at the canteens or ordering takeaways.

In those moments, the frivolous midweek lunches at San Carlo (one of the swankiest restaurants in Manchester) and boozy evenings in the city centre in December didn’t seem worth it. As I searched high and low for bargain deals on bulk noodle purchases that month, I vowed never to be in that position again. I would never be caught in the trappings of December by getting carried away with everyone else living in the moment.

That experience was my first insight into the fact that without a clear-cut plan on how to budget, we will generally spend any extra money that we have, perhaps because we naively believe that the party won’t end, or that we deserve to live it up a bit.

When given the chance to “keep up with the Joneses”, we will. And while I’m not suggesting that you shouldn’t spoil yourself from time to time, you must also know when to walk away and, most importantly, know your limits in advance and accept them. It is ok to say no, to decline invitations to never-ending get-togethers during the festive season.

Tips to avoid Janu-worry

If you’re a perpetual victim of Janu-worry, here are three strategies to ensure that you don’t have to start the year watching every penny.

Stop before you start

Before you get carried away with your December splurge, make sure that you have prepared a budget. Know how much you have allocated to spend on your indulgences, and then stick to that. You need to check yourself before undertaking any unnecessary spending.

Remember that when it comes to having a good time in December, there’s strength in numbers, but it’s a very lonely place at the bottom when the music stops playing.

Earn the right to have a good time

It’s quite OK to have some fun, but you must have earned it first. This is the basic principle of delayed gratification and planning.

I recall sitting down with a graduate many years ago when she first started working and had an opportunity to go to Thailand with her new work colleagues on a short girl’s holiday. She didn’t have any savings to use for this trip,  but because she had a decent income and a generous credit card limit, she felt that she could pay for the trip using debt and then pay off the loan over the next 12 months.

As a financial adviser, I always look at the risks involved. Given that she had no savings to fall back on, maxing out her credit card was a bad idea. She’d be getting into poor financial habits right at the start of her career.

In the end, she didn’t go, and we started a three-year goal for a holiday fund, a separate five-year goal for her house fund, and a rainy-day fund in the event that anything ever happened at work. Over a six-year period, the three accounts swelled to over R600,000.

The holiday account was used to fund two memorable overseas trips to Egypt and Thailand with photos that are plastered all over her Instagram account. The house fund paid for the deposit, transfers, registration costs and furniture for her brand-new apartment, and her rainy-day fund now has in excess of six-months’ worth of income in the event that things don’t work out, career-wise.

Make a modest start

If you’re a poor saver, and have tried and failed before to save, then we can use psychology to help turn this around.

The key is to start with what may even be perceived as embarrassingly small amounts. There are savings and investment accounts which accept monthly debit orders for as little as R50.

Pick one thing you’d like your savings to pay for in January 2025. It could be your rent, car payment, groceries, or medical aid. Assuming one of these things costs R4,000, you’d effectively have to save around R315 a month and earn an interest rate of about 8% to have the funds to bail you out come next year.

This may seem like a futile exercise. However, people who are poor savers need to understand the benefit of delayed gratification, even at a micro level.

Imagine not suffering the usual financial stress at the start of a new year, because you have the funds available to cover your car payments because you saved throughout the year. That wonderful feeling will strengthen your resolve to continue on this savings path.

The fact that you’re no longer hounded by your car finance company’s call centre over missing premiums gives you peace of mind, which came from sacrifice and preparation. It becomes a stimulus to want to apply this to a second area because you now know that saving works.

Saving is no longer a source of “pain” or “inconvenience” because it’s now attached to a sense of financial freedom which will come later. This is how, over time, you can go from battling to save, to being a great saver.

When you experience the high of reaching your goal after saving for a house, a car, or a holiday, you want to enjoy that feeling again and again. Just like exercise, once the results start to show, the so called “discomfort” of putting away that small amount every month becomes a healthy addiction.

If you start applying these three simple strategies now, by the beginning of next year you will breeze through the traditionally tight month and Janu-worry will become a thing of the past for you.

This post was based on a press release issued on behalf of Discovery Limited.