Tuesday 12 December 2017

Cents & Sensibility: Christmas Savings

It's only october but the festive season is already looming. Here's John Hearne's guide to cutting your costs this year

It's still only October, but if there's a legitimate reason to start talking about Christmas early, it's budgeting.

December is the most expensive month of the year, and nothing makes January more miserable than a heap of debt. The National Consumer Agency (NCA) has just published the results of an online poll which shows that 53pc of people are planning a low-budget Christmas this year.

A fifth of those asked said they'd been saving for Christmas all year, and only 6pc said they planned to use the credit card to get them through. To help us stick to the straight and narrow, the NCA has also put a Christmas budget planner up on its personal finance website, www.itsyourmoney.ie. It breaks the big spend down into five categories: Gifts and Cards, Food and Entertaining, Decorations, Entertainment and Other. Like all money-saving advice, the first tip is always the same -- budget. Here are 10 more tips designed to help keep your good intentions.

1> Ban christmas presents

IF you get a useless €20 scarf from Auntie Morag, don't you feel obliged to get her something worth €20, too? How many presents did you get last year? Can you even remember? How many have you used? How many are lying in a drawer somewhere, with bits of Christmas paper still stuck to them? Why not sign a 'no present pact' with members of your family? Everyone's in the same boat this year, so the idea of keeping present costs down should meet a willing audience. If you haven't already got a Kris Kindle or Secret Santa thing going, now would be a good time to start. Try to agree a fiver or a tenner limit to keep the spending under control.

2> Be creative

You could try being a bit more creative with presents. No, this doesn't involve glue and crepe paper. Offer babysitting vouchers to people with babies and they will love you for it. Give vouchers for doing dishes or making the dinner or giving backrubs. Way better than socks. If you need to buy for young children, don't feel pressurised into getting something expensive, just for the sake of it. Children can find as much fun in the packaging as the present itself.

3> Put presents on long finger

Are you really going to see Auntie Morag over Christmas? There are probably a list of people in your present posse that you won't see until New Year's Eve or later. Wait until the sales and buy then. They won't know that you didn't have it under your tree on Christmas Eve, and nor will they care.

4> Don't put things on credit

So that you're not tempted to put things on credit, cut your credit card in two. A bit drastic or you do too much online shopping to make that workable? Then ditch the card and keep the number. Or just cut it lengthways and bring your debit card out when you go. If you have to use it, try to pay it off in full the next month. Credit card debt is the most expensive way of funding anything.

5> Make a list, check it twice

Be like Santa: make that list and check it twice. This will help avoid impulse buys and buying things because 'It'll do for somebody'. The same goes for all the groceries. Don't get sucked into the Christmas spending vortex. So much cash goes out at this time of year that it's very easy to lose the run of yourself and decide that if you don't have four different kinds of potato on the table, Christmas just won't be the same. Stay in control. Go through your list carefully, and ask yourself if you really need it before you get it.

6> Start shopping now

Do all your shopping on Christmas Eve and you can bet your bottom dollar you'll be paying top price for it. The shops are, of course, the ones who start Christmas in August, in the hope of getting their hands on your cash early. The good news is that they'll entice you with a range of specials and three-for-two deals in the coming weeks. Keep an eye on cheapeats.ie, which monitors the weekly specials in all the big supermarkets. Then buy and hoard in the Christmas press. The only issue then will be to try to avoid opening anything ahead of time.

7> Don't be tempted by credit offers

You've managed to come out without the credit card, then you see that the shop is offering 0pc finance on that sofa, or this computer. The first issue is that many -- if not all -- of these deals only last for a set time period. Miss a payment or discover that you need more time to pay it off and you could find yourself paying sky-high rates for what looked like a great deal at the start.

8> Think ahead

Sometimes it's just not possible to get through the season without some kind of credit. Don't decide this in the shop. If realistically you're going to need to get additional cash from somewhere, do a bit of research and find the cheapest source, not the most readily available. Several of the credit card companies are still offering 0pc finance on balance transfers, though for a limited period of time. Check the NCA's consumer finance website, itsyourmoney.ie for a detailed comparison, and be sure to pay off the balance before the 0pc deal runs out.

9> Shop around

Shopping around may sound obvious but too many of us don't actually do it. But start early enough so that you can check out online options, too. A great Christmas deal online is only a great Christmas deal online if there's enough delivery time left to get it to you before Christmas actually arrives. Use a website such as megashopbot.com to help find the cheapest deals out there. You tell it what you want and it zips around a range of online retailers and returns a list of shops together with the price of the goods you seek. Very handy.

10> Plan for the future

Come St Stephen's Day, you should start saving for next year. If you put away €50 a month, you'll have a war chest of €600 when next Christmas rolls around. And that'll go a long way. Anyway, rumour has it that they're planning on holding it on December 25 next year.

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