November 30, 2016 Help your bank balance survive Christmas
It’s such a clichéd thing to say, I know, but I can’t believe Christmas is less than three weeks away.
Three. Crazy, right?!
Suffice to say it’s a busy time of year, albeit an expensive one.
Here’s something to consider:
Did you know Australians spend in excess of $19 billion each Christmas?
It’s insane when you think about it.
And that’s not just on presents – we’re talking entertaining, parties, celebrations, travel and donating to charities to name but a few. That’s about $1,000 per person. Which is a lot of cash to have to cover, particularly if you’re saving for a deposit on a house and trying to stay ‘on budget’.
We also tend to make a lot of emotional purchases this time of year, made all the more easy with having credit cards on hand to simply tap away without thinking about it too much.
That is until January, when your statements start rolling in.
Now, I’m not saying you should get all Ebenezer Scrooge.
This time of year, it’s all about being smart.
And setting a few parameters.
Still have fun, but just remember you don’t have a blank chequebook.
My wife and I have stuck pretty firmly to the following game plan over the past few years, which might also help your bank balance survive Christmas:
Budget, budget, budget
Did I mention budget?!
Jokes aside, set a holiday budget with an overall ‘spend’ for the period.
It should take into account all the myriad of expenses and factor in a ‘buffer’ for any unexpected ones. It should also be realistic. Don’t plan to spend more than you can afford, otherwise you’ll be behind the eight ball come January.
Know your limit
It might sound a bit odd at first, but set a limit on how much you can spend on any particular item.
Let’s use $100 as a yardstick. This means that nothing you purchase over the Christmas period can be over this amount – which you’ll factor into your above budget, obviously. In other words, it’ll ensure there are no ‘blowouts’.
Credit where it’s deserved
As a simple rule of thumb, we’ve gotten into the habit of not using our credit cards over the break.
Unless there’s an absolute emergency, that is. This ensures that we only buy what we can afford.
Or start a new one.
We do capped Kris Kringles with family (up to $100 each) and friends ($20). For us, they’re a fun way of bringing everyone together, and we use a really easy-to-use app to co-ordinate it all.
Wait for the sales, as you can save big time.
Last year, the pre-Christmas sales rivalled the traditional Boxing Day ones.
Be sure to register for email updates on promotions at your favourite stores. When it comes to buying presents, we’ve also used shopping comparison sites and apps to our advantage over the past couple of years. We’ve saved a small fortune.
If you’re having family and friends over, plan ahead and put together a list to try and stick within a budget.
And don’t be afraid to ask everyone to bring along a different plate.
For the past two years, we’ve been directly debiting $20 each week into a Christmas-specific account.
Meaning, we’ve got $1,000 ready to go towards this year’s Chrissie expenses.