Nicole Pedersen-McKinnon outlines tactics to avoid a financial hangover this holiday season.
Can it be? Is it already? Are we nearly … at Christmas? Again?
Chances are the silly season has crept up on you too. And last year nearly 40 per cent of Australians were forced to fund it using credit, found a survey by market researcher finder.com.au.
What’s more, we collectively closed out the yuletide (which runs from December 21 to January 1) almost $3.9 billion in debt … for presents alone!
Overall, the Australian Retailers’ Association says we usually spend close to $50 billion across the Christmas trading season.
So how can you make sure your indulgences don’t give you a financial hangover that lasts well in to 2018?
Tip 1: opt for Kris Kringle, such as Secret Santa
It’s very possible that not just you, but also your nearest and dearest are strapped and worried about forking out for presents. Delicately raise the subject of doing things a little differently this year … with fewer, maybe even better, presents.
A common way to do this is with a ‘Secret Santa’, where you draw names out of a hat and give just one present to that person.
Another finder.com.au survey says we spend an average of $539 on 10 gifts, so you could even cut that to, say, $250, with one cracker of a Christmas present – rather than a whole bunch of trinkets. Everyone gets something decent that, hopefully, they really want.
Who you’re allocated doesn’t have to be random either – you could decide as a family.
A further idea is the fun (and funny) way my family does Christmas: Stealing Santa. Set a present price limit of, perhaps, $50. You buy this gift for no one in particular and the more outlandish and even embarrassing, the more hilarity will ensue.
Come Christmas Day, this time you pick numbers out of a hat, and that’s the order you each get to choose and unwrap a goodie from the present pile. The comedic and controversial bit is that after someone unwraps their ‘present’ they are able to steal – actually swap it for – any previous present.
Tip 2: buy your presents with vouchers
You can save money by buying vouchers through a raft of discount facilities, such as The Entertainment Book (which you buy from the charity of your choice for about $70) and maybe the automobile club in your state. A common discount is 5 per cent, which adds up if you’re sticking to the 10 typical presents (think about it: that’s a $50 saving if you splurge $1000).
Shopping later is an approach that will snare your loved ones more loot too. Prices can drop up to 75 per cent between Christmas Day and Boxing Day – why should you pay the previous inflated cost when they can get hugely better value so soon afterwards?
You could even make the festive shopping trip a family activity.
Tip 3: avoid the last minute shopping panic
Once you know what you’re up for on the present front, it’s much easier to formulate a shopping strategy. This way you avoid the biggest financial risk at Christmas: panic purchasing as the hour draws near.
Research, possibly online first, where you can get what you need, at the cheapest price. To aid you in this sometimes daunting process, browse at Lasoo.com.au. This site aggregates a bunch of sales catalogues – you can view the outlets that offer the best deals in one place. And remember, many old-school retailers will price match e-tailers if you still want to purchase locally.
(But if you plan to buy goods or services online, get familiar with your last possible ordering date, which varies from place to place but is usually about a week before Christmas.)
At the peak package period, Australia Post usually estimates delivery time of about four days between capitals, and you can assume order fulfilment time of at least 48 hours on top of that. Note vouchers can be bought online too, saving you from the throngs at the shops … and often they are delivered almost instantly via email.
Once you have your present plan, you can execute a fast and frugal shopping trip. (Do you like how I assume you might only have to make one? I never manage it – especially when it comes to the festive feast itself!)
Tip 4: ask everyone to bring a dish
Food generally accounts for 40 per cent of our Christmas spend, according to Australian Retailers’ Association figures, or close to $20 billion between us.
It makes sense when it’s such a big, elaborate meal, to share the burden as well as the bounty. I’ll venture most of your relatives will have a favourite – and hero – dish they’re just itching to bring. And how much less stressful is that if you’re hosting?
Tip 5: plan to feast on the leftovers
Don’t ‘waist’ a thing. Work it right and you shouldn’t need to buy food for days after Christmas, as you fashion the leftovers into all manner of weird and wonderful dishes. Fried rice with prawns? Ham steaks on the barbie? Turkey curry? Delicious.
Nicole Pedersen-McKinnon is an independent commentator and educator who presents her Smart Money Start, fun financial literacy incursion, in high schools around Australia: themoneymentorway.com