What sets it apart from something like, say, a wedding anniversary or a birthday, even if you make a big deal of those, is that it’s something that most people in the community will join in with - even if they are not religious. And for Christmas in particular, the mainstream TV channels will be full of adverts encouraging you to fulfil your natural potential for hospitality.
So, most of us spend a lot on presents, food and travel. And that’s OK. But get swept along too much, and it can lead to a financial hangover that can stay with you through to the next year and beyond.
Here are our top tips to make the best of your celebrations without you wishing that they had never happened when everybody gets back to normal.
Talk to yourself!
At no other time are you likely to be as conflicted over money. For example, religious holidays usually involve families, hospitality and gift-giving. We know from studies that someone’s need to be generous is a psychological trait developed early and stays with them for life. Even so, learn about your attitudes to money and create an understanding of your feelings to have internal conversations with yourself and make spending decisions more consciously and wisely.
Take the pressure off.
Chances are, especially in a family situation, that no one will complain if there is slightly less food in the fridge or they got one less gift than they did last year. So recognise that the pressure to spend on gifts and hospitality may come from yourself.
Plan Early
Be realistic and budget accordingly. For example, if you are buying gifts, work out how much you will spend on each person – and stick to it.
Don’t forget the everyday bills.
Remember that rent, the mortgage and utility bills still have to be paid – and the consequences can be severe if they’re not. Leaving them till after will require catching up, and for some people, experience shows this can be the beginning of a debt spiral.
Don’t bank on an overdraft.
If you need more money, don’t just run up an overdraft without talking to your bank first – it will work out much more expensive.
Keep things simple
If you can afford to pay for your goods outright by cash, cheque, or debit card, don’t be persuaded to take out extended credit agreements unless they work out cheaper.
Shop around
Try as many different places as possible to find the best price. Buy what you want and not what other people say you need. Be wary of extended warranties; the cost of a repair could be less than the warranty cost.
Buy safe
Whatever the deal, whatever the temptation, don’t buy from unauthorised traders and don’t borrow from unauthorised lenders. The initial savings and convenience may prove to be a false economy.
Read the small print.
Check for hidden extras in any credit agreement. Work out the total amount payable. Ensure that the monthly instalments are within your budget before signing. Interest-free credit can seem attractive, but you could have to pay a lot more if you don’t pay on time or miss a payment.
Get the best deal on credit (if you are going to use it)
If you are going to use a credit card, shop around and compare terms. Some cards charge high-interest rates but provide interest-free periods or discounts. Budget for all these costs and put the payment dates in your diary
Get Organised
There’s a lot to remember, and if you’ve borrowed money, don’t forget that it won’t be long before you have to make a payment. So make sure you pay on time, even if it is only the minimum, or you will face additional charges.
Start planning for next year.
Once it’s all over, it’s worth looking at what you did well and didn’t do so well. Then, learn from your mistakes and plan how you will do things differently next year.
