The festive season is often a time to wind down, recharge our batteries, and enjoy some quality time with family and friends.
But, it can also be an expensive time that plays havoc with our finances (and stress levels).
This year will be no exception—according to Roy Morgan research, this year’s pre-Christmas sales are expected to reach a staggering $63.9 billion (up 3% on last year)*.
If you’re already feeling the pressure from friends and family to dig deep into your pockets, or you have a habit of getting caught up in a last minute gift-buying frenzy, these practical tips may help you keep your spending on track this time round.
1. Set a budget for every gift
Deciding on an actual dollar figure (and writing it down) can be much more powerful than guesstimating how much you want to spend during the holiday season. Once you’ve decided how much you want to spend on gift buying, divide that amount between the people you will be buying gifts for. Having a set budget for each person can help to refine your gift ideas to those that are going to be realistic.
2. Plan ahead
Leaving your gift buying to the last minute can cause a lot of unnecessary stress, but it can also mean that you may be more likely to miss out on sales. By planning your gift list ahead of time, you can keep a close eye on any price reductions in the lead-up to the holiday season. Many retailers hold large sales in November to encourage you to buy early, and put prices back to normal for the December period knowing that most people are in a frenzy by then.
Another way you can plan ahead is to have a plan for your gift buying before you step foot in a physical or online store. Taking the time to think about what each person may like may stop you from getting side-tracked by promotions or impulse buying gifts that might not be a good fit for that friend or relative.
3. Reduce the stress of gift buying
Often, the stress of gift buying can come from those around us. For example, family members with higher disposable income or nieces or nephews with high expectations might place more importance on gift-giving than you do. To help reduce the stress of gift buying, try suggesting a Kris Kringle approach this year, even if just for adults. Reducing the volume of gifts you have to buy can not only save your wallet, but it can mean you can spend more energy and perhaps more money on finding that special gift for just one person.
Another approach which might work well, is to ask your friends or family circle to agree on a spending limit for gifts. Once you have decided on a dollar amount you’re all happy with, you don’t need to worry about comparison syndrome or feel like a scrooge during the present opening ceremony.
4. Share the cost of family gatherings
Your nearest and dearest will hopefully understand if you want or need to keep costs down, especially at a time when inflation is rising rapidly. If you’re hosting a large family gathering during the festive season this year, ask your guests to contribute. It doesn’t need to be a financial contribution, the ‘bring a plate’ approach can be a more socially acceptable way of asking people to chip in on the financial burden, and also reduce the stress and workload of cooking for a large group.
5. Focus on thoughtful gifts and experiences
Often in life, it’s the memories that we remember and cherish for a long time, rather than the material possessions that we owned. This year, consider making your gift-giving less transactional, and more focused on unique, thoughtful ideas or experiences you can share together. For example, you might buy a baking or patisserie class for someone who loves to bake cakes. Or, you might instead take a friend or family member to an event they would be interested in. If you’re into making things, you might make something handmade and truly unique. The possibilities are endless once you get your thinking cap on.
The lead-up to the holiday season can be stressful, but hopefully these practical tips can help you take back control of your spending this year. If you’d like to chat about anything in this article, get in touch.
Contact Carrick Aland’s award-winning Wealth Planning team on 1300 466 998 or visit carrickaland.com.au/wealth-planning/.
This report is prepared by Bridges Financial Services Pty Limited ABN 60 003 474 977 AFSL 240837 (Bridges). Bridges is an ASX Market Participant and part of the IOOF group of companies. This report is prepared by the IOOF Research team for: Bridges Financial Services Pty Limited ABN 60 003 474 977 AFSL 240837, Consultum Financial Advisers Pty Ltd ABN 65 006 373 995 AFSL 230323, Elders Financial Planning ABN 48 007 997 186 AFSL 224645, Financial Services Partners ABN 15 089 512 587 AFSL 237 590, Millennium3 Financial Services Pty Ltd ABN 61 094 529 987 AFSL 244252, RI Advice Group Pty Ltd ABN 23 001 774 125 AFSL 238429, Shadforth Financial Group Ltd ABN 27 127 508 472 AFSL 318613 (‘Advice Licensees’). The Advice Licensees are part of the IOOF group comprising IOOF Holdings ABN 49 100 103 722 and its related bodies corporate (IOOF group). The Advice Licensees and/or their associated entities, directors and/or employees may have a material interest in, and may earn brokerage from, any securities or other financial products referred to in this document or may provide services to the company referred to in this report. The document is not available for distribution outside Australia and may not be passed on to any third person without the prior written consent of the Advice Licensees. The Advice Licensees and associated persons (including persons from whom information in this report is sourced) may do business or seek to do business with companies covered in its research reports. As a result, investors should be aware that the firms or other such persons may have a conflict of interest that could affect the objectivity of this report. Investors should consider this report as a single factor in making an investment decision. The document is current as at the date of issue but may be superseded by future publications. You can confirm the currency of this document by checking the intranet site (links below). The information contained in this report is for the sole use of advisers and clients of AFSL entities authorised by the Advice Licensees. This report may be used on the express condition that you have obtained a copy of the Advice Licensees Financial Services Guide (FSG) from their respective website. Disclaimer: The information in this report is general advice only and does not take into account the financial circumstances, needs and objectives of any particular investor. Before acting on the advice contained in this document, you should assess your own circumstances or seek advice from a financial adviser. Where applicable, you should obtain and consider a copy of the Product Disclosure Statement, prospectus or other disclosure material relevant to the financial product before making a decision to acquire a financial product. It is important to note that investments may go up and down and past performance is not an indicator of future performance. The contents of this report should not be disclosed, in whole or in part, to any other party without the prior consent of the IOOF Research Team and Advice Licensees. To the extent permitted by the law, the IOOF Research team and Advice Licensees and their associated entities are not liable for any loss or damage arising from, or in relation to, the contents of this report. For information regarding any potential conflicts of interest and analyst holdings; IOOF Research Team’s coverage criteria, methodology and spread of ratings; and summary information about the qualifications and experience of the IOOF Research Team please visit https://www.ioof.com.au/adviser/investment_funds/ioof_advice_research_process.
