How to prepare financially for Christmas

This year, Australians have faced rising cost of living and financial pressures, which may not fuel the Christmas spirit as we look ahead to December. Here are a few ways to reduce the financial strain of Christmas, without ditching the cheer.

1. Make a list

In an ideal world, you would be able to buy a thoughtful gift for every special person in your life. The reality is buying presents for everyone, including your second cousin’s partner, is not financially sustainable. Make a list of the people you want to get a gift for this year, and then look at why you are getting them a present. Keep the names of those who are essential then look at your list of people and overall budget to then work out cost per person. If you’ve got 5 people to buy for and a budget of $200, you can aim for $40 per gift. If you’re buying for little kids that aren’t your own, chances are they will be just as happy with a smaller, cheaper item, so you don’t need to go all out on big name brands, leave that to Santa.

2. Kris Kringle

Instead of buying every family member their own present this year, think about suggesting a low-cost Kris Kringle, and set a price limit for purchases. It can be far easier on the budget to buy one $50 present, than several items that all add up. Consider Kris Kringle with a theme, eg: only homemade items, or Op Shop finds for a laugh.

3. Group presents

If you can’t give up the gift giving, why not join up with other family members in buying presents. If you are going to get a gift for a parent, why not ask your sibling or other relatives to go in on a present and share the cost.

4. Give the gift of time

You’ve got your list of people to give presents to, but think instead what could you do for this person? Could you offer a special skill or even make something special? Homemade gifts may feel cheap to give, however they are always more meaningful. Think of things like helping in the garden, baby sitting, walking the dog or even helping with things like setting up Nanna’s new phone.

5. Food shop early

Think ahead to your Christmas day plans, and what food you need to make or bring. If you know that you’re on desserts this year, keep an eye out for specials on the items you need. Check out the reduced to clear section for what can freeze, which is most things. Hit up stores like NQR or even the Reject Shop to see what items you can get ahead of time, and on budget. If you can avoid last minute purchasing, you will be able to save time and money.

6. Unwrap your presents

Gift wrapping paper can add up to one of those hidden costs of Christmas morning. Instead of hitting up the shops for shiny new paper this year, look around the house for what you may already have on hand. If you have kids, get them to draw and colour in on butchers’ paper if you have on hand, or really cheap baking paper for a minimal, cheap wrapping. You could take inspiration from ‘Furoshiki’, the ancient Japanese art of fabric gift wrapping. Check out the local op shop for fabrics that you can use to gift wrap, while also being suitable and keeping costs under control.

7. Memories not money

Christmas is about spending time with family and friends, so try to keep in mind that your family, and kids especially, won’t look back in years to come and think how great Christmas was because you spent hundreds of dollars on them. Instead, people will have memories of being together and celebrating.

Bonus consideration:

Christmas isn’t just about financial pressure, there is also a good dose of social pressure to catch up with family and friends, often involving dinners or activities that can quickly add up. Resist the urge to say yes and be honest with people, decline the invite and say that you’re watching your Christmas spending this year. If you’re feeling up to it, you could offer a no-cost alternative, so instead of dinner out, invite your guests over for a dinner where everyone brings a dish, or a BBQ catch up in the park.

If you are having difficulties with managing money, you can reach out for support:

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