Add to smarts: How to manage your Christmas spend this year
By Kimberly Gillan | Presented by Bendigo Bank|
Thankfully, festive fun and money stress don't have to go hand in hand. In fact, if you start getting organised now, you can get into the Christmas spirit without fretting about finances. Here's how.
1. Focus on loved ones
As much as Christmas is synonymous with gift-giving, Tracey Sofra, a financial advisor who specialises in women's financial confidence, says that reminding ourselves of the true meaning of Christmas can help keep spending in check.
"When it comes to Christmas, it's about sharing and coming together as a family and enjoying each other's company," she points out.
"It's not necessarily about present-buying. Most people just want to be with loved ones and share a good meal together."
If you're feeling the pinch this year, Raymonda Bechara, Bendigo Adelaide Bank Senior Manager – Wealth Concierge, suggests talking honestly with family and friends about ideas for reducing the Christmas cost.
"You might be surprised to learn that they also have wanted to raise the issue," Bechara says.
2. Know your numbers
As tempting as it can be to bury our head in the sand, Sofra says doing a "cash flow analysis" is crucial to stress-free spending any time of the year.
"You need to know what's coming into your account, and what's going out of the account, which can be done using an app or a spreadsheet [to determine] if there is a surplus," she advises.
Bechara says it can be helpful to set up a separate Christmas bank account to top up throughout the year.
"If you decide that you can afford $50 a week for this expense, set it aside in an account which you do not have easy access to, to reduce the temptation to use this money throughout the year," she says.
"Remember that whilst the temptation is there to spoil ourselves and our loved ones, putting items on credit or 'buy now, pay later' means that you will be paying for those goodies well after Christmas has passed, on top of your usual expenses."
3. Do some clever catering
It's not just Christmas Day that can threaten our budgets – all that December socialising can get costly if you don't plan ahead.
"Lunch and dinner menus tend to be more expensive, and are often accompanied with expensive alcoholic drinks," Bechara notes.
"So, consider catching up for brunch or a picnic in the park, which reduces the temptation to overspend on costly drinks and dinner menus."
Writing an extensive food and drinks shopping list at least a month before Christmas can also enable you to start stocking up on sale price non-perishable foods and drinks.
"You can sneak five or six items into your trolley each week in the lead-up to Christmas which won't affect your budget as badly as it would if you did a massive shop the week before," Sofra says.
4. Think ahead
When it comes to the essential pressies on your list, it can be prudent to snap up some sale items throughout the year – and remember, January is the cheapest time to stock up on decorations for next Christmas!
"At Christmas time, we can get caught up in the excitement and make some emotionally-driven purchases, whereas we may be more logical and less emotional about Christmas presents in July," says Sofra.
"Always ask yourself, 'Is this what this person definitely needs? Or is it that I'm caught up in the moment and should probably look at an alternative?'"
Gifts don't always have to be big-ticket items either.
"Get creative – put cookie ingredients in a mason jar with instructions on how to make them, or provide your friends with young children a voucher to babysit while they have a night out," Bechara suggests.
"Or, use your collective resources to create hampers for those in need which not only reduces the financial pressure but is rewarding and in the true spirit of giving.".