My Credit Union

Stay ‘in the black’ this Christmas – and leave the red to Santa

Print

Top tips for a thrifty Christmas

With Christmas only three weeks away, we are well and truly into the festive season. While there are many things to love about this time of year, the lead-up to Christmas can also spark a sense of financial fear as personal finances easily begin to spiral out of control.

It isn’t just the gifts, it’s also the additional costs associated with a busy social schedule that can really add up. According to a recent article from SMH, Australians are tipped to spend a whopping $48.1 billion in retail stores over the Christmas trading period.

While it may seem difficult to stay in the black this Christmas, it isn’t impossible. There are a number of easy things you can do to make sure you emerge without debts that you’ll be paying off until Christmas next year.

Here are our top five tips for a thrifty Christmas:

  1. Start a savings plan. Although Christmas is only three weeks away, it’s not too late to put a little money aside. As they say, a little goes a long way. Between now and Christmas, put aside the absolute maximum you can afford per week to pay for gifts or extra social events. Even $100 per week is almost $300 to play with. Christmas Club Accounts are a great way to ensure you put money aside that you won’t be able to access before you need it. Setting one up now for next Christmas will ensure you have an entire year to build up a good savings buffer.
  2. Set a budget...and stick to it. Knowing what you can spend is the best way to ensure you curb overspending. Think about what you can afford and budget around it. Make sure you keep track of your spending too. It’s pointless to set a budget if you don’t regularly track against it. There are plenty of free apps that can help you manage your finances, including TrackmySPEND, Goodbudget, Wally, Level Money or Mint.
  3. Prioritise your present shopping. Just like Santa, you should be making a list and checking it twice. Once you have made a list of everyone you want to buy a gift for, don’t forget to make sure they fit within your budget. Getting organised not only ensures you avoid the last minute Christmas shopping rush (which can be more expensive, not to mention frantic) but also stops impulse buying that can quickly blow the budget.
  4. Avoid putting huge amounts on your credit card. According to SocietyOne, Australians will spend $4.6 billion on their credit cards this Christmas, with a further $191 million to be forked out for interest. While putting all expenses this festive season on the credit card may seem like the easy option, the high interest alone can leave you with a debt hangover well into next year. Consider other options like using a debit card with a personal overdraft account, which gives you the best of both worlds. Don’t forget to look for one with a low interest rate! If you are going to use a credit card, make sure you use it responsibly and know your limit.
  5. Look for Christmas bargains. Spending some time looking for the best prices – on everything from gifts, to food, to airfares – can end up saving you a lot in the long run. Scouring advertising catalogues and checking for any online offers are a must this time of year. Comparison websites like Google Shopping or NexTag do the hard work for you and are a one stop shop for finding the best prices across a range of items and suppliers. If you’re doing your shopping in-store, don’t forget some stores will match or even beat competitors' deals so compare their offers and keep all the details with you when you are in store.

Remember, Christmas doesn't have to be a financial headache if you plan ahead and make smart financial decisions.