As we fast approach the beginning of October our thoughts inevitably start to turn towards Christmas and all the financial strain that it potentially brings. The shops are already starting to fill up with tempting offers and over the coming weeks Christmas adverts will start to appear on our television screens. And we’ve not even had Halloween yet, which itself can be a costly experience!
All too often people leave their Christmas preparations too late and try to buy everything using their November and December salaries (assuming that your employer does actually pay your December salary prior to Christmas). By leaving things to the last two salary periods people run the risk of having to rely on credit to ‘pay for Christmas.’ Why is this? Well, they fail to take account of their normal household bills (ie. Mortgage/Rent, utilities, etc) and then panic when they realise that they have failed to factor these costs into their plan.
So, how can you avoid a possible financial headache in the New Year as a result of your Christmas spending on gifts, food, drinks, etc? Simple – try to plan ahead and/or stick to a pre-determined budget.
I know what you are thinking – that’s easier said than done. Yes, it is, but it could be a lot less painful than the aftermath of unstructured spending when the credit card bills, or short-term loan repayments, require to be paid from January 2017 onwards.
Government statistics show that in 2015 a typical family, spent an average of £796 on Christmas. That is a huge amount of money to find from one, possibly two, monthly salaries, on top of everything else that needs to be paid. But, if this cost could be spread over the next four salaries (September, October, November and December) then that would work out at approximately £200 per month – arguably a lot easier to absorb.
This one little ‘tweak’ in your finances could go a long way towards a debt free festive period and, who knows, the idea of regular budgeting and saving may prove to be the way forward. £50 a month for eleven months (January to November) would mean that you could have £550 saved towards Christmas 2017.