As the Christmas holidays draw closer, saving and budgeting for the holidays can feel daunting, but Rose Miller, financial education consultant at the JN Foundation, says with a few simple strategies, you can make it easier and stress-free.
She recommends these five easy ways to manage your money this Christmas.
- Set a Budget
Create a total budget for Christmas spending and stick to it. List all the gifts and other items you plan to buy, the family gatherings and parties you will attend, and the travel expenses you anticipate. Decide how much you can afford to spend and stay within that limit.
- Create a Christmas Savings Plan
It is good to have a Christmas savings plan, such as direct deposit into a savings account. Alternatively, set up an automatic transfer to a savings account or a Christmas fund each payday.
- Shop Smart
Giving a nice gift doesn’t have to mean spending a lot, so shop with your budget in mind. Make a note of all the places that offer discounts or competitive prices before going on your shopping adventure.
- Start Early
Shop early and be careful when you spend. Avoid shopping in a hurry or while under pressure. This can lead to overspending. Before you head to the cashier (or online checkout), make sure your purchase is within the budget you had set for yourself. Saving months in advance is helpful. If you start early, you can save a little each month and avoid last-minute financial stress. You can set up a dedicated holiday savings account or envelope system to separate your savings from your regular funds.
- Track Your Spending
Use apps or spreadsheets to monitor how much you’re spending on gifts, food, travel, and entertainment. Stick to your budget and adjust only as necessary.
Mrs Miller recommends looking for sales or shopping at discount stores to stretch your gift budget. Consider DIY gifts or experiences (like cooking dinner or offering a homemade coupon book for favours) to save money.
In the weeks leading up to Christmas, she recommends reviewing your spending habits and cutting back on non-essentials (eating out, entertainment, among other things). Use any extra savings to boost your holiday fund. If you’re hosting a big holiday meal, consider making it potluck-style or scaling down the number of dishes to save money. Re-evaluate expensive traditions and find affordable alternatives, for example, a homemade ornament exchange instead of expensive store-bought gifts. By planning, tracking your spending, and making small sacrifices along the way, you can enjoy the holiday season without overspending.
