Ask An Adviser - How Do I Prepare My Christmas Budget Like A Financial Planner?

Top answer provided by:

Andrew White

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Hi Nathan, a very topical question at this time of year!

Christmas and the holiday season are often a very happy time to be celebrated with family and friends. That said, it can also be a very expensive time if you’re not properly prepared.

Here are my top tips for keeping your finances under control, whilst ensuring you have something for everyone:

Write a list.

This is where I like to start, write a list of all the people that you are planning to buy a gift for. Once you’ve got this, put down an expected present value next to each name. This will allow you to have a good idea of how much it’s likely to cost all up. It’s also a great point to start noting down ideas for each recipient.

Get organised.

Once you’ve got a list and some ideas, it’s time to start researching and shopping. This means taking advantage of sales and buying a few things each week to spread out the cost. Avoid using credit cards or buy-now-pay-later offerings as these will just come back to haunt you in January. Deals sites such as Catch, MyDeal and Ozsale are good for grabbing a bargain. I’d suggest getting started as soon as possible – the earlier the better.

Make gifts where possible.

Instead of buying boxes of chocolates or bottles of wine as a gift, maybe consider making Christmas themed biscuits or cakes. It still ticks the box as a nice treat, but comes with a lower cost for you and is more personal for the recipient as well.

Reduce costs where possible.

Ever paid $5 for a birthday card? I have (I had failed to plan ahead!) and I almost choked as I handed over the money. Easy ways to save include using gifts tags or labels instead of cards, and using a basic paper wrapping instead of something more expensive. In our house, we are using a plain paper wrap that has been stamped with a Christmas theme by our sons – it’s a fun activity for them and nicely personalised for each person.

Following these steps should ensure you’ve got something for everyone, and have a good handle on what you’ve spent – this will enable you to be prepared for other inevitable bills down the track.

Other great ideas that could help at this time of year are:

Raise some money from unused or unwanted items.

I try to periodically sell any items that are perfectly good but are no longer used in my house. I’ve found Facebook marketplace, Gumtree and Ebay to be really good for this. I love this process because it serves three purposes: someone will get some use out of an item that my family no longer use, it avoids things going to landfill, and I raise a little bit of pocket money.

Consider your family’s gift giving habits.

Many families give gifts to everyone in their family and extended family. A more budget friendly option may be to give gifts to everyone in your direct family, then organise a Kris Kringle amongst the extended family (i.e. where each person just buys for one other person for a set amount). This ensures everyone gets a gift, but limits the spending and potentially some wastage. Another option is giving gifts to the children in the family and the adults agreeing to no gifts.

Agree on a limit.

When giving gifts among friends, agreeing on a spending limit always helps. Finding something fun and personal for a friend for $20 will generally bring a bigger smile than a $50 gift card.

These ideas should further reduce the cost over Christmas without taking away any of the fun.

Nathan – I wish you and your family the very best this Christmas season. I hope my tips give you some inspiration on savings ideas, whilst still ensuring everyone has a fantastic time.

All the best,

Andrew

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Article by:

Andrew White

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