As special a season as it is, Christmas can also be a huge financial drain, leaving behind consequences long after all the presents have been unwrapped. The good news is that you can enjoy this important holiday time without breaking the bank and ending up with some major debt. All it takes is some financial forethought and planning.
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Try these five financially-savvy moves this Christmas
1. Avoid Christmas fever
While Christmas is definitely a time to celebrate and indulge a bit, it does not need to be an invitation to go crazy with spending, gifting, and expensive purchases. When it comes to your Christmas meal, shop clever and avoid over-spending and over-buying. And remember that the day is about being with those you love rather than buying them the most expensive ‘must-have’ gifts.
2. Make your gifts
Not only can homemade gifts be a unique and memorable way to spoil a loved one, they can also be a big money-saver. Do you have a talent for sewing, baking or crafting? Do you paint or enjoy making homemade trinkets like Christmas tree decorations? A homemade gift lets you put your best skills to work without breaking your budget.
3. Give the gift of time
The best gift vouchers are those that let the recipient pick what they want and, for many people (especially working parents), the gift of time is a valuable and rare one. Why not offer to babysit your friends’ children or offer to cook dinner for a family member once of month for the next six months? Service can create just as much happiness (if not more) than possessions.
The end of the year doesn’t have to be just about saving. Smart money management is also about looking ahead and planning for the future. If you’ve received a year-end bonus (or 13th cheque), avoid the temptation to spend it on extra presents or even more activities for the kids. Think about investing at least part of it in your financial security, from retirement funding to long-term wealth creation. When it comes to establishing your financial legacy, there’s very little as powerful as the power of compound interest.
5. For next year – plan ahead
You know that it’s important to budget and save accordingly for your annual goals (whether it’s a big purchase like a car or a fun weekend away). Treat the Christmas season (and all the hosting and gifting that goes with it) as a item in your annual budget and, next year, get ahead by planning and saving for all the festivities a few months ahead of time. This will stop you from having to dip into your yea-end bonus or creating major debt during a particularly cash-strapped time of the year. Set aside ‘Christmas’ money and then you can happily make use of it when the time comes.
Want more tips like these? Read our blog. As independent advisers, from insurance to investment management, we can help you put in place a financial plan that allows you to enjoy your wealth while ensuring your continued financial stability and growth.