Ho, ho, oh no. C******** is coming. Sorry for raising the spectre of the C-word this early. I growl at jingle bells in October as much as the next Scrooge. Yet this isn’t about early celebration, it’s about preparation. There’s things you should do NOW to reduce financial and other stresses for the big day.
Every January people tell me they’re skint (it’s debt counsellors’ biggest month). When I ask why they say “Christmas of course”. Yet it’s on 25 December every year, it’s not an unexpected expenditure, so planning matters.
And for those who’ll instead be celebrating Eid, Chanukah or owt else this winter, don’t worry, in the main the same tips apply.
- Agree now with friends to BAN unnecessary Christmas presents. Many feel pressured to buy gifts for an extended list of friends, family and colleagues, often panicking, “I’ve got to get ’em something, anything” – even if they won’t want it. This tit-for-tat giving means we end up with tat.Even ‘the joy of giving’ can be selfish as it obligates someone to buy back for you – and they mightn’t be able to afford to. The best gift can be releasing someone from the obligation of buying you something. Make a no unnecessary present pact, or at least cap the cost with a Secret Santa – then if you want to give more, donate to charity.I’ve been campaigning on this for years, you may enjoy the detailed theory behind it in mse.me/banxmasgifts.
- Make £150 in time for Xmas by switching bank accounts. One big festive help is extra cash. Perhaps the easiest way to do that is to switch bank accounts to one willing to PAY YOU for your custom. As it can take up to 60 days to get the cash, do it now to definitely have it in time for any necessary pre-Christmas spending. For a full rundown and pros and cons of each read mse.me/bankaccounts, but here’s some very brief top picks.The biggest bonus is www.hsbc.co.uk Advance account which pays new switchers £150, plus a further £50 after a year. Yet you need to pay in £1,750/mth (earn over £26,100 and it just means have your salary paid in there, as that’s £1,750+ after tax – you can take the money out straight away if you like).Alternatively www.firstdirect.com has won every customer service poll I’ve ever done and gives switchers £100. www.bank.marksandspencer.com gives a £125 gift card and adds £5/mth to it for a year. And both require a smaller monthly pay in of £1,000/mth. With all accounts you usually need to be a new customer, pass their (not too tough) credit check, use their 7 day switching service and switch 2+ direct debits.
- Not saved for it? Do it now – then you can split the cost by four.The surveys say a typical family spends around £800 at Christmas. For most that’s totally unsustainable from one month’s income. So if you haven’t started saving yet, there’s still time. For example, put £200 aside from your September, October and November income, and spread the cost. If you’re saying “no way I can’t afford that”, then fair enough, I’m afraid you’ll need to go cold turkey.
- Small sacrifices now can make big savings. And small sacrifices now can add up. For example if you give up a £2 coffee every work day… I’m not saying you should give up everything completely, but make an active choice: would you prefer the cash at Christmas or the daily treat? The demohohotivator.com tool works it all out for you.
- Train-ing home for Christmas? Get ready to book. Train tickets are usually released 12 weeks before travel, and that means it’s the best time to ensure you get hold of cheap advance tickets. So if you know when you want to go we’re nearly at the booking point for Christmas and New Year.
- Don’t plan the perfect Christmas. That’s a dangerous mind set. Instead, first work out your budget and let your financial situation rule. Then ask yourself: “What’s the best Christmas I can have on the money I’ve got?” Remember it is just one day. Far better to have a slightly less expensive Christmas than a financially frantic New Year.
- Free £100 Amazon/M&S/Boots voucher in time for Christmas.Accepted new americanexpress.com Rewards Gold charge card customers get 20,000 bonus points for spending £2,000+ on it in the first three months. These can then be swapped for £100 Amazon/M&S/Boots etc gift card (shops can change), or airline points.Just put all your normal spending on it – it’s not an excuse to spend more – and as long as that’s over c. £700+/mth (not huge for a family), you’ll qualify. You also get two free airport lounge passes, and earn points for spending.But watch out, there’s a £140 annual fee after the first year, so if you don’t want to keep it, make sure you diarise to cancel it. Also, as it’s a charge card it must be repaid IN FULL each month – there’s no choice. Missed repayments cost £12 and mean a credit file black mark.
- Walk around the house looking for anything unused since last Xmas. Shops don’t just value the cash in their till, they value their stock too. And this is a great time for your annual personal stock check. If you’ve unused items, why not flog them for cash whether toys, prams, old coffee makers, mobile phones, gadgets, or even clothes, why not sell them? Have a look on eBay to see if any of your bits are suitable for sale. There are also lots of recycling sites that will pay you for old mobiles and gadgets – just make sure you do your research first to find the one that’ll give you the most.
Martin Lewis is the Founder and Chair of MoneySavingExpert.com. To join the 12 million people who get his free Money Tips weekly email, go to www.moneysavingexpert.com/latesttip.