Chinese New Year Are Red Envelopes Putting You In The Red

2017-01-20   minute read

Augustine Kwok

Lifestyle Debt

Chinese New Year, it is a time for celebrating. However, with this festival falling so soon after Christmas and New Year (this year, it will start on January 28), some families will be confronted with extra debt as a result of the increased expenses often associated with these festive periods.

Chinese New Year is a 15 day festival, which in addition to its traditions, involves many visits and gatherings with friends and families and invariably, includes a lot of food and eating out, gift giving and the ubiquitous red envelopes. For a family struggling financially, this can be a difficult time of year as these expenses accumulate rapidly and the family often feels obliged to incur these expenses as a matter of meeting societal expectation.

The tradition of giving red envelopes originated in the Qin Dynasty and is meant to represent “money to ward off evil spirits”. They are given by married couples or elders to children and unmarried juniors of the family or of a friend’s family. Depending on the size of one’s extended family and the extent of one’s friends and social circle, this can add up to a considerable expense. This is far from the only expense associated with Chinese New Year. It is customary for families to buy new clothing to celebrate the New Year, gifts of fruits and candies are often exchanged when visiting loved ones and the accompanying feasts at restaurants can cost several hundreds, if not a thousand dollars per table.

Proper planning and financial management can help to make your Chinese New Year more of a celebration and less of a headache. Start planning a budget for the various anticipated expenses a few months in advance. At the same time, be sure to set money aside to meet these expenses. If savings alone is insufficient and debt must be incurred, have a plan to pay off the debt as quickly as possible. Alternatively, the plan may be altered so that it can fit into your budget. Some creative ways to save funds could include having reunion dinners at home instead of at a restaurant, purchasing items and gifts required for celebrating Chinese New Year earlier to avoid paying a premium in the period leading up to Chinese New Year and using the free red envelopes that banks and major retailers often give away as a marketing ploy so you can avoid the expense of purchasing new ones.

A major custom of Chinese New Year is to clean house; sweep away the bad luck and experiences which have gathered in the previous year. Cleaning house also means settling all your unfinished business to start fresh for the New Year; resolve disputes and disagreements with friends and pay off debts. Prudent planning and careful budgeting can help prevent an inauspicious start to the Year of the Rooster.

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