Tis the season….for a financial hangover!

shopping-center-538018_1280So ladies, have you started your Christmas present shopping yet? I’m about halfway through (which is typical for me) – I buy a few odd things in September or October, and then leave most of it until early December. Congratulations to those who have finished already !

Being organised with your money in the run-up to Christmas is key. The goal is to enjoy the festive and New Year season, without over-stretching yourself and leaving yourself with a financial headache i.e. a debt, throughout the first half of next year.

Plan, budget, be disciplined, and try to leave the credit cards alone !

The best advice I can give is to pay off Christmas expenses by the end of January at the latest. As well as planning ahead wherever possible, it’s also worth recognising what the “true cost” of Christmas can be…it’s not just the presents and Christmas Day lunch, it’s all the social engagements through December, plus the presents, plus food & drink for many days throughout the holidays, cost of pantomime trips etc

I’ve pulled together some “Top Tips” for managing and budgeting effectively through Christmas – purely based on my own experiences. I hope you find them useful.

  1. Set a budget for presents – and as we know, it’s the thought that counts ! Finding the right present for each person is likely to be far more appreciated than an expensive present that they may or may not want!
  2. Set a separate budget for the cost of entertaining / hosting at Christmas. Laying on food and drink for the masses is not a cheap exercise, so try and stay within your means. You can ask your guests to “bring a dish”, or a plate of mince pies, as well as a bottle – most people enjoy contributing something, so if someone offers, say “yes”.
  3. Pre-Christmas partying – if you’re lucky enough to have a mad social whirl of engagements to attend before Christmas, it’s worth setting yourself a maximum spend for this too. Otherwise the cost of new dresses – and then of course shoes, bag and accessories  – plus travel / taxi expenses etc can spiral.
Paying for it
  1. Start shopping as early as possible to manage within your set budget. If you’re under pressure to buy something in desperation on Christmas Eve, you’re likely to spend more than if you had purchased earlier.
  2. Ideally, use cash or debit cards to make your purchases. Before reaching for the credit card to find those extra funds, consider whether you have any other savings or cash ISA funds that would be more economical to use than incurring a high interest charge. Interest rates for savers remain very low, whereas a typical Annual Percentage Rate on a credit card is a hefty 18% *
  3. If you have to use a credit card, make a promise to yourself to clear the whole amount in January. By paying your credit card off in full, you avoid paying interest charges on what you owe.
  4.  If you can’t afford to clear the credit card bill in one go, you’ve probably spent too much…..a lesson to learn for the following year !

* Source : MoneySupermarket, Nov 14

To receive a complimentary guide covering Wealth Management, Retirement Planning or Inheritance Tax Planning, please contact Amanda Redman on 07801 045587, email [email protected] or visit www.amandaredmanfp.co.uk


About the author

After an extensive and successful career as a business and marketing Director with a global, blue-chip company, Amanda retrained in 2013 as a Financial Adviser and set up her own business, Amanda Redman Financial Planning. She is qualified with a Diploma in Regulated Financial Planning, adding to her Masters degree in Languages from Cambridge. She has 2 children, Max 16 and Tamsin 5, is married to Mike and lives in Tonbridge, Kent. Follow Amanda’s blog or visit: www.amandaredmanfp.co.uk .

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