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Tuesday, January 18, 2011

This Christmas will be different!

It’s unfortunate that Christmas is often called the ‘silly season’. It doesn’t have to be silly, there are things we can do to make sure it doesn’t get out of hand, and that it’s fun and festive. So continuing on with the resolutions theme, perhaps we can implement some Christmas savings ideas for 2011.

We tend to forget that money is just like other aspects of our life, it requires careful planning and commitment to achieve true success. You wouldn’t go on a camping trip without planning, so why should your Christmas spending be any different? You need a plan!
First off you need a Christmas budget (sorry FIDO doesn’t have an online version). Make a list of the people you need to buy Christmas presents for, and an amount you expect to spend beside each name. I also try and actually think of an appropriate gift at this point – it makes it sooooooo much easier when you actually hit the shops.

When buying gifts, try and do it in a planned, controlled manner without getting too emotional about the purchases. Not leaving it to the last minute, and making a list before you reach the shops, could help guard you against impulse buying. When you’re desperate, you can end up spending a lot more than you intended.

Make sure you also think about:
• Decorations;
• Christmas get-togethers;
• Christmas lunch/dinner;
• Cards;
• Kris Kringle;
• Shopping Centre wishing trees.

And don’t forget the Christmas break, whether it’s camping, a resort, or just staying at home and taking the kids to the movies – it all costs money.

So how do you ensure the money is there come December?

I was talking to a client recently that has a Christmas Club account. The best thing about Christmas Club accounts is that they enforce discipline. You only have a short window of opportunity when you can access the funds to ensure that the money is there for Christmas.

The drawback to these types of facilities is that they don’t pay a very high rate of interest, so if you have confidence in your own discipline then you could choose a higher interest bearing account instead.

Alternatively you may even want to implement a longer term strategy that you can draw-down from each year.

These days there are also food hamper plans. These allow you to stagger the cost of food and gifts for Christmas over the year rather than in one big hit at the end of the year. I’d certainly advocate doing your homework to make sure you’re not paying a large premium for the convenience and payment plan.

I’d be very interested in hearing from anyone that has used these services, to find out whether they found them to be worthwhile. Just add a comment below or email me at

Don’t wait until the end of the year to start spending. You can start preparing for next Christmas at the January sales! Christmas wrapping paper, decorations, toys, games and much more are often up to 50% off. Or at least take advantage of sales throughout the year – if you see something on special that you know would make a great gift for someone, grab it or put it on lay by.

I always do this. In fact one year I bought all the presents for my nieces and nephews in July (12 in total) and put them on a “Christmas lay by”. By doing this I didn’t have to pick them up until as late as Christmas Eve, so it even solved the problem of where to store them.

With hindsight this was a great idea, because not only was I able to buy presents that were on sale, but I was also able to stagger my Christmas spending. My only caution is to keep a list detailing the present and the person you’re buying it for, otherwise it can be very confusing when you eventually collect that lay-by.

Have you thought about introducing a family Kris Kringle? In my family, the brothers, sisters, brother’s-in-law, and sister’s-in-law all put their names in a hat and rather than buying for everyone, we buy a really nice gift for one person each. Of course this didn’t work out so well for my sister this year when my brother in Byron Bay decided he wasn’t coming down until February…

A quick warning about credit cards….. ‘Plastic money’ makes spending very easy. So much so, that many people are left with a ‘spending hangover’ (thanks to my friend Vivienne James, author of The Woman’s Money Book”, for that term). Use your credit card wisely (remember it’s the most expensive loan you’re likely to ever have). Then get rid of the credit card debt as quickly as possible because it’s high interest and not tax deductible.

So if you found the Christmas finances tough this year, don’t ignore the situation – put a plan in place for this year. After all, if you don’t do something different, you’ll find yourself in the same position every Christmas. Try even one idea, and let me know how you go.

Talk soon,


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