Top 10 tips for managing money better this festive season
Managing money during the festive season can be challenging. But careful planning could allow individuals to enjoy the holidays without getting into debt, says Jonathan Watts Lay, Director, WEALTH at work.
WEALTH at work’s top 10 tips for managing money this festive season:
1. Set a budget
Create a detailed budget that includes all expenses, such as gifts, decorations, food, entertainment, nights out, travel, increased utility bills, clothes, and stick to it. There are many free budgeting apps available that can help track spending.
2. Use online shopping hacks
Price comparison tools can help find the best deals on gifts. Idealo finds the best price online for a particular product and CamelCamelCamel allows you to track the price of Amazon products. Consider installing browser extensions like Honey that search for discount codes during online check-out.
3. Beware Black Friday
Black Friday, on 24 November, and Cyber Monday, on 27 November, are supposed to be days when people can get amazing deals, but the discounts offered should always be checked as they are not always as good as they seem.
4. Other ways to reduce costs
Agree spending limits with family and friends, and consider alternative options like homemade gifts or experiences, which can be cost effective and more personal. Leave credit cards at home to avoid overspending, and for those who aren’t seeing family until after Christmas, buy their gifts in the sales.
5. Maximise workplace benefits
Individuals should take advantage of employee discount schemes offered for discounts on, for example, groceries, dining and even gift purchases.
6. Beware energy use
Energy bills can rocket over Christmas due to the increased use of cooking appliances, heating, washing and technology. So, people should be as energy efficient as they can. Turning off lights when they aren’t needed, washing clothes at 30 degs, making sure the dishwasher is only used when full and boiling the kettle fewer times, all add up.
7. Understand borrowing methods
Borrowing to pay for Christmas should be a last resort, but credit cards are useful for the protection they give for purchases over £100. Choose cards with 0% finance or cashback. Those with credit card debt should consider a balance transfer to a lower interest card. It’s important to be wary of ‘buy now and pay later’ deals and to understand the terms and interest charges if repayment isn’t made on time. Individuals should always speak to their provider if they are unable to make a payment.
8. Split cost across pay packets
Those who have a credit card could consider splitting the cost between two pay packets. For example, if a credit card statement date runs from 1 November to 1 December, anything spent on the card in November will be due for repayment in December. But anything spent in December would be due for repayment in January. All credit cards have different statements and payment dates, so it is important to check with the provider when planning to split costs.
9. Budget now for 2024
By making a few small changes, individuals could get to next Christmas in a much better financial position. Ditching takeaway meals, taking lunch to work, not buying coffee when out, switching supermarkets and budgeting better can all make a huge difference.
10. Automate savings
Another option is to consider setting up automatic savings transfers, which round up transactions to save small amounts. For example, when purchasing something for £4.20, the bank rounds it up to £5, and 80p goes into your savings. Two transactions like this per day could help to save £584 over a year. Some workplaces offer payroll-deducted savings schemes for effortless saving.
Jonathan Watts-Lay says: “While the festive season can be an exciting time for many, it can also be a stressful time for those who are worried about their finances.
“Proactive employers are actively working to remove the stigma around money worries and encourage their employees to not suffer in silence and access the support available. Key to this is offering financial education and guidance to help employees understand their finances including ways to manage a budget, make savings and manage debt.”
He adds: “Employees who are struggling should be aware that they can contact free services such as MoneyHelper, Citizens Advice or National Debtline.”
In partnership with WEALTH at work
WEALTH at work is a leading financial wellbeing and retirement specialist - helping those in the workplace to improve their financial future.