HONOLULU (KHON2) — The holidays may have felt like a whirlwind of family gatherings, gift exchanges and travel plans; but for many, the beginning of tax season also brings a spike in financial stress.
While it might be easy to overlook the financial toll of the holiday season during the fun and festivities, the reality sets in quickly as tax season arrives soon after.
As the dust settles, credit card bills are due, savings feel depleted, the New Year brings a fresh set of financial goals and challenges and tax season sets in.
For Kevin Morisoli, a wealth management advisor with Northwestern Mutual, the financial stress that arises after the holidays is all too familiar.
In fact, he’s seen it time and time again as clients face the aftermath of their holiday spending as tax season begins.
“The holidays tend really to pull out a lot of stress around finances,” he said. “There’s just so much that comes at us fast. Halloween comes; and before you know it, it’s Thanksgiving and then Christmas. All of a sudden, we’re hit with travel costs, presents, and food, and it can get overwhelming.”
Morisoli, who has spent nearly 20 years helping clients manage their financial futures, knows that financial wellness isn’t just about investments or retirement planning.
It’s also about managing the emotional and behavioral aspects of money. That’s why he approaches wealth management as a form of “finance therapy”, where the goal is to ease clients’ anxieties about money while also helping them set realistic and intentional goals.
Financial stress: Why it happens
According to Morisoli, the holidays leading into tax season are a particularly stressful time for many families because of the combination of expectations and expenses.
“People think about the holidays, and it’s so much more than just presents,” he said. “You have airfare, hotels, rental cars, extra meals, and then you add in the pressure to give gifts. It all adds up quickly.”
A study from Northwestern Mutual found that around 33% of Americans experience stress or excitement about their finances. And when the post holidays and tax season are factored in, those feelings are amplified.
“What we see with our clients is that it’s not always just one thing that causes stress,” Morisoli explained. “It’s the totality of the expenses. And because the holidays come so fast, people don’t always feel prepared.”
For many, the emotional side of spending — whether it’s overspending on gifts or feeling pressure to be more generous than they can afford — adds a layer of anxiety.
“It’s this sense of needing to make everything perfect; and people often put things on credit cards, hoping they’ll figure it out later,” Morisoli said. “That’s where the debt cycle begins.”
Building a budget: The key to financial peace
The solution, Morisoli explained, lies in proactive planning.
“A lot of people think budgeting is just about tracking expenses,” he said. “But it’s about awareness. The more we know about our spending habits, the better we can prepare for things like the holidays.”
Morisoli emphasized that when clients have a handle on their day-to-day expenses, they’re in a better position to handle those larger, seasonal costs.
“It might sound simple, but just being aware of where your money is going on a daily basis can make a huge difference in your ability to plan for big expenses,” he said.
One of the strategies Morisoli recommended is creating specific savings accounts for recurring expenses such as travel.
“We’ve had clients set up ‘travel funds’ where they earmark money throughout the year for flights, hotels and transportation,” he said. “It’s like a Christmas account, but it’s specific to those holiday costs. So, when the time comes, they don’t have to stress about it.”
He also encouraged clients to treat this time of year like a “big project” much like how you’d plan for a wedding or a family vacation.
“Holidays are a big, predictable expense that’s immediately followed by the emerging tax season,” Morisoli points out. “Once we know how much it’ll cost, we can break it down and plan for it ahead of time.”
Understanding the emotional side of money
The biggest challenge for many people, however, is not the logistics of budgeting but the emotional side of money.
“People avoid budgeting because they’re afraid of what it will show,” Morisoli said. “They’re worried that it will tell them they’re spending too much or not saving enough. But just like exercise, there are growing pains. And sometimes, it’s uncomfortable to face the reality of how much we spend.”
Morisoli refered to this aspect of financial planning as “behavioral finance” which is about understanding the psychology behind spending and saving.
“The reality is, if you don’t know where your money is going, it’s hard to make good decisions,” he said. “But once you’re aware, it becomes easier to make smarter choices.”
He used the example of eating out, something many people do without thinking twice.
“Most of us eat out too much, and we don’t even realize how much it’s adding up,” he explained. “But when we look at the numbers, it becomes clear, and that’s when we can make adjustments. It’s a growing pain, but it’s necessary to get to a place where you’re more comfortable with your finances.”
How to break the debt cycle
One of the biggest pitfalls of the post-holiday and tax seasons, as Morisoli pointed out, is falling into debt.
“When we don’t plan ahead, the debt cycle kicks in,” he said. “And that’s what we really want to avoid.”
For those who are already in debt, Morisoli advised clients to be strategic in paying it off.
“If you’ve accumulated credit card debt during the holidays, you need to be focused on paying it off as quickly as possible,” he said. “Those high-interest rates make it difficult to pay down debt; so, we always encourage clients to make paying down debt a priority. Otherwise, you’re just managing the interest; and the principal doesn’t go down.”
If debt is already a concern, Morisoli suggested looking into balance transfers or consolidation options which may offer zero-interest periods that can help clients reduce their financial burden more quickly.
“Sometimes, if we consolidate, it gives people a little breathing room to pay it off faster,” he explained. “But no matter what, the most important thing is to have a plan.”
Using credit wisely
Another important strategy during this post-holiday and tax season period, Morisoli said, is using credit cards strategically.
While he doesn’t recommend relying on credit cards for large purchases, he acknowledged that they can be a useful tool if used wisely.
“If you’ve been using your credit cards responsibly all year, then this is the time to cash in on rewards points,” Morisoli suggested. “Use your points to pay for things like travel and try not to increase your debt.”
He also stressed the importance of paying off the balance as soon as possible.
“The trick is to use credit cards for convenience and rewards but always pay off the balance right away,” he explained. “Otherwise, you’re going to get stuck with interest; and it can snowball out of control.”
Financial therapy: Working through the vulnerability
What sets Morisoli apart in his work with clients is the way he approaches finances with a therapeutic mindset.
He calls himself a “financial therapist” because, in his view, financial planning is not just about numbers. It’s about understanding the emotional and psychological barriers that keep people from managing their money well.
“We have a lot of conversations about money that aren’t just about numbers,” he said. “It’s about how people feel about money and how it impacts their lives. Sometimes, it’s about opening up and being vulnerable; and that’s something we really try to create with our clients.”
He added, “I’ve seen it all. I’ve made mistakes, too. It’s not about being perfect. It’s about progress. And sometimes, the hardest part is just talking about it. But once you do, it’s so much easier to move forward.”
For Morisoli, helping clients navigate the stress of the post-holiday and tax seasons, and of money in general, is more than just advising on financial strategies.
It’s about fostering open communication and offering a judgment-free zone where clients feel safe to talk about their fears, their mistakes and their goals.
“People are often afraid to ask for help; but once they do, they feel such a relief,” he said. “We’re in this together. We’re not perfect, but we’re working toward a better future.”
Moving forward: Building better financial habits
Morisoli encouraged clients to take the lessons learned from the previous holiday season and use them to build better financial habits for the future.
“If we can make a few small changes, we can avoid the same mistakes next year,” he said. “It’s about creating a system that works for you and building better habits over time.”
By setting realistic goals, being proactive with budgeting and understanding the emotional dynamics of money, it’s possible to navigate the financial stress of the holidays and emerge stronger in the New Year.
Morisoli’s approach isn’t just about surviving the season; it’s about thriving in it and beyond.
“You don’t have to be perfect, but you do have to be intentional,” he concludes. “It’s not just about getting through the post-holiday time. It’s about being prepared for whatever comes next.”
As we move further into the new year, Morisoli’s advice offers a valuable roadmap for anyone looking to build a healthier relationship with money: one step at a time.
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This is the fourth in a four-part series in which KHON2.com sits down with a local wealth management advisor to discuss planning for holiday spending and tax season.