The holiday season can become an expensive exercise.
The cost of gifts, food and decorations can easily lead to spending more than you can afford.
Avoid getting into debt this Christmas to make sure your finances are in the black for the new year with these simple tips:
1. Plan gift giving
With so much to do at this time of year it’s not suprising that 45 per cent of Australians leave Christmas shopping to the last minute, according to Stockland research. Buying gifts this late can not only mean inappropriate presents, but also spending more than you can afford.
It can be helpful to write a list of friends and family who you plan to buy presents for and allocate a spending limit to each person. Then you can come up with a few gift ideas and begin looking for these now instead of waiting till Christmas Eve.
2. Buy gifts in bulk
Stores often have two-for-one promotions or similar deals which can make for more affordable gift-giving. Things that you can buy in bulk then separate into smaller presents include casks of wine.
3. Pay off that credit card
To avoid getting into debt this holiday season, avoid paying minimum payments on your credit card. Instead, try to pay as much as you can, if not the full amount. This will help you begin the new year without a large amount owing on your credit card.
Related: How to stay out of credit card debt
4. Make the most of promotional deals
If you are looking for a new credit card this Christmas, make sure you choose the right card for your needs. Compare credit cards by their interest rate and low fees before you commit to a new credit card. Make the most of your interest free period on your new card but be aware of when this promotional period ends and the reverted purchase rate.
5. Know your limit
Be aware of your spending limit and stick to it. Some credit cards charge up to $40 for exceeding your spending limit. While this fee won’t send you into debt, it is an easily avoidable expense that you don’t need during the silly season.
6. Transfer your debts
Spending may be unavoidable but you may be able to pay your debts off at a lower rate. A balance transfer card could help you pay off any amounts owing in January.
7. Make a Christmas budget
Write up a budget for the holiday season to ensure you don’t spend more than you need. Trimmings like decorations, wrapping paper, and food can quickly add up if you don’t assign an amount to each. Not sure how to make a Christmas budget?
Related: 10 ways to budget for Christmas
8. Go homemade
Homemade gifts and decorations are a great way to make your holiday season more personal and cost-friendly. They are also an easy way to get the kids into the festive spirit and keep them busy during the school holidays. You can get them to make Christmas cards, wrapping paper and decorations for your tree. And relatives always appreciate homemade cakes, biscuits and jams.
9. Consider before you cater
We all tend to overeat at Christmas lunch or dinner with plenty of leftovers to spare. But considering up to 40 per cent of our garbage is made up of wasted food according to Foodwise, it is important to think realistically about the number of people coming and how much food and drink you really need. Throwing leftovers into the rubbish means you are throwing away money that could be better spend elsewhere.
Delegating cooking duties can be a clever way of dividing food costs and labor. Ask guests to bring a plate, dessert, or drinks so you share the workload of catering for your party.
10. Be thoughtful
Remember that the most special thing about the holiday season is spending time with the ones we love. It’s true that it really is the thought that counts. Older relatives will particularly enjoy a visit from you instead of just another gift. A thoughtful gift can be taking a family or friend out for a picnic, offering to babysit their children, taking them out fishing, giving them a manicure or helping them around the home or garden.
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