5 Ways To Help Save For Christmas
Sep 21, 2022
It's still September but Christmas will be here before you know it. Christmas can be a time of worry for a lot of people and studies have shown that 53% of people feel financially stressed when it comes to Christmas. According to the Bank of England, the average household spends nearly £740 more in December than a typical month and spending on food and alcohol increases by 20% and 38% respectively. Then there are the presents, which can all get a bit much!
Planning in advance can help alleviate the financial stress and make you feel more positive about Christmas. Below are 5 tips on how to start saving for Christmas and reduce the financial burden of the holiday season.
1. Set up a Christmas savings account
Now you've decided to start saving for Christmas, let's take the first step and set up a savings account and label it your 'Christmas pot'. This account is just for Christmas so that you can track how much you are saving and also know how much you have to spend for Christmas.
2. Plan how much money you need to save and see if there are ways you can reduce how much you spend
Make a list of of everyone you need to buy for and how much you can afford to spend on each person after your bills and essential expenditure is paid. Write down how much you can afford to spend on decorations and food and any other items you may need to buy. Once you know how much you can afford to spend then you'll be less likely to overspend. Resist the urge to put things on a credit card as you will need to pay this back at some point and you don't want to overstretch your finances. Transfer some money in your Christmas pot and work out how much more you need to put in your Christmas pot and how regular you will make payments into this pot.
When planning how much you need to save, look at ways to reduce how much you spend on presents this year. Club together with friends or family to buy presents or set a limit, for example, £15 per person. Our family now only buy for the children at Christmas. We do a secret Santa for the adults where everyone's name is put into a hat and everyone draws one name and buys for them only. We also set a limit. That way, everyone gets a present they are happy with as well as saving money. You can also buy some presents that are things they need and you would have bought them anyway. I always end up buying gloves or clothes for my 2 boys as part of their Christmas presents, which I would have bought anyway.
You could also make gifts or give people promises as gifts, such as an IOU for a free nights babysitting or a promise to walk the dog for 2 weeks. I once got an IOU from my sister to see the Counting Crows live and my dad got one to see Kate Bush. I think I waited about 3 years to get my IOU and my dad is still waiting patiently, 10 years later.
You could use brown paper for wrapping presents. I don't see the point in spending money on wrapping paper as it just gets ripped up and you can't recycle wrapping paper. Also, you could use last years Christmas cards to create your own tags - my mum has done this for years! You could also send eCards instead of real ones, although you won't be able to make your tags!
3. Make saving money automatic
Work out how much you can afford to save each month and set up an automatic payment into your Christmas pot straight after payday. This way you won't be tempted to spend the money on other things or find that you don't have enough at the end of the month to put towards your Christmas savings.
4. Cut back on expenses and add the savings to your 'Christmas pot'
Making little adjustments to your expenditure can really add up over the months. Look at your bank statements and see what you could cut back on. Are there subscriptions that you don't use anymore, could you negotiate a better rate or can you shop around for a better price? You could swap your brands for cheaper versions or you could reduce the amount of alcohol you buy each week. You could eat out less, reduce the number of takeaways you have or cut down on your takeaway coffees. You could also look at cheaper ways to entertain the family at Christmas time such as Christmas markets or free events in your local area. Whichever ways you cut back on your expenditure, add these savings to your Christmas pot.
5. Stick to your budget and don't get carried away with sales
Try and stick to your budget and track your expenditure. You can track this on a spreadsheet or on a notebook or an app on your phone. You can get your receipts emailed to you and set up a folder for the receipts so you can keep track of how much you have spent and on what.
As you know, in the lead up to Christmas there are loads of deals around, especially on Black Friday and Cyber Monday. If you're anything like me, you love a good bargain, but remember a bargain is only a bargain if you were going to buy the thing in the first place. Otherwise, it's an impulse buy and something you haven't budgeted for. There are sites you can use to check whether you are really getting a good bargain or not and ask yourself whether you really need it or whether you are just buying it because it's on offer. Stay strong, stay focused and remember why you are doing this🙂.