Our gift to you this Christmas? Four in-advance tips to keep your finances in a jolly state
According to the Australian Bureau of Statistics, Australians splurged a whopping $47.5 billion during last year’s Christmas shopping period. That probably made for a lot of blistered credit cards and debt hangovers come February!
As your credit advisor, I’d like to recommend a more sensible approach to spending this silly season. Here’s a few tips to help you keep things under control. We’ve still got about four weeks until Christmas Day so, if you’ve already organised yourself, this will help keep the rest of your Christmas season in-check.
But if you’re one of the many ‘I’ll do it in December’ types (and there are many of us!), then it’s not too late to read on!
1. Set a Christmas budget
It’s easy for things to get out of hand when you don’t have a budget. Before you hit the shops or start browsing through your favourite online stores, put together a Christmas budget. And it’s not just about the gifts you hope to buy. Include the costs of meals, entertainment, gifts and even the planned outfits you’ll need to consider for those Christmas parties that are starting to fill your calendar.
Not sure where or how to start? Try ASIC’s MoneySmart TrackMySPEND app. It allows you to set spending limits for different categories of Christmas expenses and track your spending as you go.
Also, if you’re planning to travel or book holiday accommodation over the Christmas period, you should factor those costs into your budget too. A big trip with air fares might warrant a call to me about a personal loan, rather than than plonking it on your credit card.; it could make it easier to pay off and potentially save you some money on interest.
2. Know your triggers
To cut back on needless spending, understand the triggers that lead to impulse buying. Maybe you like to do a little late-night online shopping? If so, turn your phone off at dinnertime, leave the laptop or ipad on the shelf once the dishes have been done, and don’t go back to them until morning.
Again, like many of us, perhaps you tend to get caught up in the Christmas shopping excitement the closer it gets to December 25? If you know that’s how you typically roll, then stop now, take a deep breath, start a gift list and get on with ticking the items off. Don’t procrastinate! It means you’ll avoid the Christmas rush that obviously influences how you spend.
Another tip is to take cash with you to the shops and to leave your credit card at home. That way you won’t be tempted to tap-and-go willy-nilly and get a nasty shock later.
3. Embrace sentimental gift-giving
A great way to avoid overspending this Christmas is to opt for sentimental gifts rather than extravagant presents that cost the earth. Need inspiration? You could:
- Have a family photo taken and give everyone a copy as a gift
- Get crafty with handmade gifts, cards and wrapping paper
- Bake something! The time is well-worth it for the smile it inevitably puts on people’s faces
- Shop at markets, op shops and charity sites
- Make your own redeemable vouchers for tasks like babysitting and massages.
There are heaps of other things you could do to save, so put your thinking cap on and get creative! For any gifts you need to buy, save where you can by purchasing items on sale and by shopping around for the best price.
4. Consider a Kris Kringle or Secret Santa Exchange
When you have a big family, gift-giving costs can really add up. Why not suggest a Kris Kringle or Secret Santa exchange instead?
Each family member draws a name out of a hat and buys a gift for that person anonymously. The benefit is you can set a spending limit and everyone receives a gift. You won’t have to fork out hundreds of dollars on presents for multiple people, nor will you have the stress of finding the right gift for difficult aunt Muriel (unless of course you’re unlucky enough to draw her name!).
You can even double your Christmas Cheer by applying point number three (sentimental gifts) to point number four (the Kris Kringle/Secret Santa exchange).
5. Don’t forget what Christmas is all about – spending time with others, rather than spending money
Don’t lose sight of what it’s important to spend on – time with friends and family, more so than money on gifts and possessions. Memories last longer than things!
Also remember Sinclair Wilson is here to help if and when you want to discuss a better way to finance your spending and holiday requirements than putting it all on your credit card. We can also assist with finance for big-ticket items like a new car, family boat, or an overseas trip for example – and help you get it organised quickly. Contact us to find out more.
This article provides general information only and has been prepared without taking into account your objectives, financial situation or needs. We recommend that you consider whether it is appropriate for your circumstances and your full financial situation will need to be reviewed prior to acceptance of any offer or product. It does not constitute legal, tax or financial advice and you should always seek professional advice in relation to your individual circumstances. Subject to lenders terms and conditions, fees and charges and eligibility criteria apply.