With Christmas done and dusted, you may be looking forward to forgetting about the festive season (and all the expense that comes with it) for the next 11 months. But now is the perfect time to start saving and planning for Christmas 2017. Christmas can be costly, but if you’ve budgeted, planned, and prepared in advance you can avoid getting into financial difficulties this Christmas. Find out how with our top tips!
There’s no sense planning to spend less this Christmas if you don’t know how much you usually spend at Christmas. Many of us like to avoid our bank balances after a period of heavy spending, but it’s important to get a clear idea of how much you really spend at Christmas – not what you think or hope you spend.
Go through your receipts, bank statements, and credit card bills and build up a picture of your Christmas spending. Which areas did you spend most on last year? Where did you find great bargains? What could you improve on? Once you know what your spending habits look like, you can start working on a plan to improve.
Hopefully, you’ve already created a personal or family budget for the year ahead, but chances are you’ve not factored Christmas into it.
Work out how much you think you’ll need to spend on Christmas this year and then split that into five categories: food, presents, decorations, travel, and days out (or whatever categories suit your spending best). That way, not only will you know how much you need to save, but when it comes to spending you’ll also know how much money you can allocate to different things.
Once you have your Christmas budget, work out how much you’ll need to save each month (or week, if you prefer) to reach it. Then, look into your ordinary budget or financial plan and find areas where you could cut down to help future you pay for Christmas. Could you start taking your lunch to work instead of buying that supermarket meal deal? Could you walk to work and save money on petrol? Small changes often make the biggest difference.
Once you know how much you need for Christmas this year, it’s time to start saving!
There is a myriad of saving options available, from Christmas Clubs to Cash ISAs to instant saver accounts. Do your research and find out which method suits your needs best.
For example, if you’re often tempted to dip into your savings and spend them on other things, a Christmas Club might be the way forward. With Christmas Clubs, you start saving early in the year and put aside a set amount each month – but you can’t withdraw the money until a few weeks before Christmas.
It’s worth noting, however, that Christmas Clubs often require you to exchange your savings for shopping vouchers or gift cards, or buy direct through the club. It’s also important to ensure that your Club is part of the Christmas Prepayment Association (CPA) to protect your savings if things go wrong.
If you want to opt for a Savings Account, be sure to compare different kinds of accounts to ensure you make the most out of your money. Our savings comparison tool can help you compare savings accounts, cash ISAs, and peer-to-peer accounts. So, get comparing, and then get saving!
Last updated: Tuesday, 3 January 2017
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