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budgeting for Christmas – our top tips

December 25th comes around so quickly each and every year. While the kids can’t wait to see what it will bring, many adults look to the festive season with financial uncertainty, and worry about the spending to come.

Each year, there seem to be more people to buy gifts for (even the postman gets a look in). And beyond the presents, there’s food, drinks and decorations for Christmas day. It can feel overwhelming and it happens each and every year.

Australian’s spend close to $10 billion on Christmas gifts each year, but there are ways to avoid blowing the budget.

Young happy woman in red Christmas hat sitting with laptop

Here are some great tips for sticking to your budget for the festive season:

Put it in context

It is easy to get carried away with festive purchases.

Make a list and check it twice

Have clear lists, be it for gifts or groceries and do your very best to stick to it. Try not to get distracted by those cleverly positioned items as you queue at the check-out.

Spend with cash

Using cash rather than charging everything to your card can keep your spending moderate.

Get in early

Those who get in early and make the most of the big sales earlier in the year are very wise to do so. For those whose shopping starts in December, it’s still a case of the sooner the better. Last minute rushing around is likely to lead to impulse buying. There’s a reason these gifts are described as ‘panic purchases’!

Avoid using credit cards..

especially if you’re going to have trouble paying the bill when it comes next month. If items are purchased using credit, try and pay more than just the minimum payment when the bill arrives as interest will compound at a higher rate.

Buy local

With a world of options at our fingertips, it is easy to forget to shop locally. Most locations have a regular market day where local providers sell their wares, and your local boutique likely carries unique gifts for your special someone’s. By choosing local you are supporting a neighbour and have a good chance of finding a quality piece for a good price.

Kris Kringle

Join 27% of Aussie families and opt for Kris Kringle or ‘Secret Santa’. Rather than buying numerous gifts for different family members, put names into a hat to draw from and spend an agreed amount on one person. Traditionally, it’s meant to be secret but getting good gift suggestions from your Kris Kringle recipient will also help the budget.

aussie christmas tree at beach

Lay-by gifts

Lay-by often results in better money management. To make the most of this option, it’s best to get in early so that the payments are smaller regular payments over a longer period of time.

Compare prices

If you need to purchase big ticket items (i.e. white goods), do your research and source the retailers, online or in-store, prepared to beat competitors’ prices. Most retailers can do better than just ‘price match’.

Talk about spending with family

Have a discussion, especially when there are lots of kids or grand kids to buy for. Ask family members for suggestions that are practical and inexpensive. Children most appreciate a gift that brings them joy and sometimes an inexpensive item (a beach toy, dress up costume or soccer ball) will provide hours of fun. Lego might be on the top of the child’s wish list but generally, after being built for the first time, Lego tends to be left unloved.

Be helpful

Bring a dish or two for the host/hostess on Christmas Day. Cooking and hosting others can be stressful enough without having to purchase all the food, drink and Christmas crackers too. If you’re hosting, ask family members to chip in by bringing something.

Start saving early

Once the New Year comes around, think about putting money aside each month so that Christmas 2017 does not make that sudden dent to your hip pocket. A clear budget can help you manage your cash needs throughout the year.

Christmas spending can be overwhelming and after all that running around, the unwrapping of gifts is over so quickly but it’s important not to lose sight of the magic that the time of year brings too. There is something wonderful about that special December day each and every year – be it reading those ordinary jokes and donning the paper hat from the crackers, eating too much food or trying to remember the words to those carols you learnt as a child. Best of all, Christmas is a time when families gather and people treasure those they love.

What you need to know

This information is provided by Invest Blue Limited (ABN 91 100 874 744). The information contained in this article is of general nature only and does not take into account the objectives, financial situation or needs of any particular person. Therefore, before making any decision, you should consider the appropriateness of the advice with regards to those matters and seek personal financial, tax and/or legal advice prior to acting on this information. Read our Financial Services Guide for information about our services, including the fees and other benefits that AMP companies and their representatives may receive in relations to products and services provided to you.