“Managing your money during the festive season can be challenging, but some careful planning could mean you are able to enjoy the holidays without getting into debt.” says Jonathan Watts Lay, Director, WEALTH at work, a leading financial wellbeing and retirement specialist.
To help with this, WEALTH at work has outlined some top tips below…
WEALTH at work’s top 10 tips for managing your money this festive season
1. Set a budget – Create a detailed budget that includes all your expenses, such as gifts, decorations, food, entertainment, nights out, travel, increased utility bills, and clothes, and stick to it. There are many free budgeting apps available which will help you to track spending on groceries, eating out, entertainment etc.
2. Use online shopping hacks – Use price comparison tools to find the best deals on gifts. Idealo finds the best price online for a particular product and CamelCamelCamel allows you to track the price of Amazon products. Consider installing browser extensions like Honey that search for discount codes during online check-out.
3. Beware of Black Friday – Black Friday is on the 24th November, and Cyber Monday is on the 27th November. These are supposed to be days when you can get amazing deals, but ensure you check the discounts being offered as they are not always as they appear. Ideally find out the pre-sale price of the item you are buying, so you know if it really is a special offer!
4. Consider other ways to reduce costs – Discuss and agree on spending limits with family and friends, and consider alternative gift options like homemade gifts or experiences, which can be cost effective and more personal. Leave credit cards at home to avoid overspending, and if you aren’t seeing family until after Christmas buy their gifts in the sales.
5. Maximise workplace benefits – Take advantage of any employee discount schemes offered by your workplace. Many have discounts on groceries, dining and even gift purchases etc.
6. Beware of energy costs – Energy bills can rocket over Christmas due to the increased use of cooking appliances, heating, washing and technology. So, make sure you do all you can to be energy efficient. Small changes such as turning off lights when they aren’t needed, washing clothes at 30 degrees instead of higher temperatures, making sure the dishwasher is only used when full, and cutting down on the number of times the kettle is boiled can add up to really make a difference to your bills.
7. Understand borrowing methods – Borrowing to pay for Christmas should only ever be a last resort, but credit cards are useful for the protection they give for purchases over £100. If you use a credit card, choose cards with 0% finance or cashbacks. Consider balance transfers to lower interest cards to save on interest payments and pay off debt as quickly as possible and on time to avoid missing out on 0% interest offers and incurring extra charges. Be wary of the ‘buy now and pay later’ deals and make sure you understand the terms and interest charges if you don’t repay on time. Always speak to your provider if you are unable to make a payment.
8. Split cost over pay packets – If you have a credit card, consider splitting the cost between two pay packets. For example, if a credit card statement date runs from 1 November to 1 December, anything spent on the card in November will be due for repayment in December. But anything spent in December would be due for repayment in January. All credit cards have different statements and payment dates, so it is important to check with the provider if you plan to split costs.
9. Budget now for 2024 – By making a few small changes you could get to next Christmas in a much better financial position. Ditching takeaways, taking lunch to work, not getting coffee when out, switching supermarkets, and learning to budget can make a huge difference.
10. Automate savings – Consider setting up automatic savings transfers, which round up transactions to save small amounts, but can really add up. For example, if you buy something for £4.20, the bank rounds it up to £5, and 80p goes into your savings. Two transactions like this per day could help you save £584 over a year*. Check if your employer offers payroll-deducted savings schemes for effortless saving.
Jonathan Watts-Lay also comments, “Whilst the festive season can be an exciting time for many, it can also be a stressful time for those who are worried about their finances. There is no shame in explaining to friends and family that you need to be careful with your spending this year, they may actually be relieved.
If you find yourself struggling with finances, free support is available from MoneyHelper, Citizens Advice and National Debtline. Also, proactive employers are actively working to remove the stigma around money worries and encourage their employees to not suffer in silence and access support including financial education and guidance, so reach out for help if you need it.”