To avoid a financial hangover at Christmas, follow these five Christmas shopping tips and start the New Year on a debt-free note.
Set a strict budget
Christmas may be a time for giving but it’s also a time when there are a lot of sales and it may be tempting to spend your Christmas cash on a designer dress you have had your eye on or a new video game. It will be easier to keep a firm hold on your Christmas spending if you set aside an allocated amount of money for your partner, family members and friends and don’t go over that set amount. Make sure you set aside a small amount for last minute contingencies.
Pay by cash
Withdraw the exact amount of money that you have set aside for your Christmas budget and only pay for items by cash. In this way, you’ll be able to monitor how much money you have spent and be less tempted to buy anything that is not on your Christmas list. Even if you pay by EFTPOS, you may spend over your limit so cash is a much better option.
Use layby
If the store gives you the option, layby more expensive items by placing a small deposit, paying off the purchase in agreed instalments over a certain period and paying the balance when you pick up the item. You will be able to pay the purchase off in agreed instalments. Check the conditions of the layby as some stores may have a hefty cancelation fee if you decide not to go ahead with the transaction.
Don’t go over your credit card limit
It may hard to reconcile your spending if you are using a bank credit card, store credit cards and so on. If you’re planning to use your credit card, consolidate your spending on one card and stick to your credit card limit. Credit cards may be a convenient way to pay for presents but make sure you pay the amount back within the interest free period to avoid any charges.
Set limits
To avoid ‘keeping up with the Joneses’, set aside a limit for family gifts in accordance to everyone’s budget or alternatively have a family ‘Kris Kringle’ where you buy one gift for a family member at a set budget. This can reduce the stress of trying to think of a gift for each family member and reduce your money woes. When you’re buying presents for relatives and their children, it can add up to be a very expensive time of the year.
So follow these tips and have a financially happier Christmas this year that you won’t be paying for in the New Year.