Christmas is fast approaching. It will not be long until Santa is saddling up his reindeer and heading to town.
The festive season gives us all a chance to reflect on the year that was, spend valuable time with our loved ones and allow us to re-charge the batteries before doing it all again! It is also a time that is associated with spending money and a lot of it!
Here are five quick and easy steps to help you put in place your Christmas budget and make this year a debt free Christmas.
1. Make a list of everyone to whom you would like to give a gift to
This will provide you with focus.
2. Figure out how much you can afford to spend
This calculation is relatively simple. How much money can you save between now and December 25th? How much of this are you willing to dedicate towards gifts? This figure must be an amount you save in cold hard cash and not the dreaded credit card.
If the number is low, that is okay. Remember, Christmas is not about financially crippling yourself just so you can feel good about giving someone an expensive gift.
Refer back to your list you made in Step 1.
Now you are going to make it a shorter list. Life is about prioritisation.
Separate your list into three groups – paid gift, made gift and no gift.
Since you now know how much you can afford (Step 2), this will give you a better idea of how many people can be on the paid gift list. Knowing your time available, you can limit your made gift list. The others – no gift.
4. Allocate accordingly and complete
Paid gift – next to each name on your paid gift list subscribes a monetary amount. Be sure that total does not exceed that number you came up with in Step 2. If you had planned to spend $100 on your partner, stick to it. Do not decide at the last minute that you would really like to get them that iPad they wanted, or those new diamond earrings. Stick to the plan!
Made gift – if you are arty and creative make something. Customized cards or Christmas tree decorations are simple yet effective ideas. If you are good in the kitchen, why not bake something? Christmas puddings, gingerbread and other treats are a good idea for close friends, neighbours and work colleagues.
No gift – sometimes the simple things in life mean the most to some. A personalised handwritten card, email or simply just picking up the phone and having a conversation with a family member or friend are great ways or sharing the festive spirit as well as being cost-effective.
5. Make it work
Do not spend more than you budgeted. You have a plan now stick to it! Discipline is key. Remember you can have a giving spirit without having a negative bank balance.
Don’t forget the reason for the season.
The above is provided as general advice only. It does not take into your personal circumstances or financial goals. If you would like to discuss further the opportunities involved with budgeting and having a financial plan, call to book an appointment with one of our talented financial advisers today!