Our 12 days of perfect Christmas planning cuts to the crunch: how can you stop your Christmas spending spiralling out of control? Here’s some tactics for making your Christmas budget more manageable.
Picture by Daniel Lobo
You’ll be disappointed if you think that there’s some magical formula that will eliminate Christmas financial stresses. Setting a budget for Christmas is the same as setting a budget for your life in general: it requires planning, discipline and a willingness to grapple with a spreadsheet. Planning helps with many aspects of Christmas, but few have such an obvious benefit as actually setting a budget.
Many of the hints that we'll offer here are equally applicable to overall budget planning. The big difference with Christmas is that it's a fixed event which happens every year, which means that you should be able to factor it into your overall plans, not just go nuts in December. Even if you've already blown out your spending for this Christmas, you can plan to do better for Christmas 2011.
I'm not going to push the oft-encountered argument that Christmas should not be about spending money either. For many people, buying presents for others and decorating their house are a major factor in the pleasure of the season. The trick is to know how much you're spending, not just roam through a shopping centre randomly acquiring presents and trinkets and throwing them all on credit cards.
Set a year-long approach to Christmas saving
The notion of a Christmas account is not a new one. These days, you'd probably be better off using an online-only bank account to get the best interest rates, but the principle remains the same: save a fixed amount each month, and then you'll be covered for Christmas when December rolls around. Have the money automatically transferred so you're not tempted to spend it elsewhere.
Buy Christmas goods on sale after Christmas
This is not novel advice, and I suspect that many stores are so alive to the post-Christmas sales trick that the savings aren't as great as they used to be. But if you have storage space (and arguably your own home), then stocking up in early January can be a good idea.
Set a fixed per-person gift budget before you start shopping
It's not uncommon: you spot the "perfect" present for someone, buy it, and then feel guilty if you don't spend a similar amount on everyone else (or everyone else at that family level). Avoid that guilt by setting a per-person amount in your head before you do any gift buying. That approach is used for "Secret Santa" gifts in workplaces, but it's equally applicable to your gift buying in general.
Shop with a fixed amount of cash, not a credit card or EFTPOS
Once you've set those amounts, consider withdrawing the relevant sum of money to cover the total and then pay for gifts with cash. If you're paying electronically, it's much easier to spend more than you intended. (You'll also progress through queues more speedily.)
Inventory your decorations
Knowing what you've already got makes it less tempting to invest in brand-new decorations in this year's fashion colours. That's not to say you shouldn't replace some old or worn-out decorations, but you don't need a whole new fit-out every year.
What are your best Christmas budget tricks? Share them in the comments.
Lifehacker's weekly Loaded column looks at better ways to manage (and stop worrying about) your money.