Colm Fitzpatrick
Colm Fitzpatrick explores how to cut down on costs this Christmas
Christmas often elicits imagery of family gatherings, present-sharing and festive cuisine, but behind this ideal hides many financial costs and burdens. Last year, Retail Ireland projected that the average Irish household spent over €2,500 on Christmas gifts, which may find their root in more expensive technological products, pressure on parents to please their children and the consumerist society that we live in.
Colette Power, National Development Officer of The Money and Budgeting Service (MABS) told The Irish Catholic: “At Christmas, spending tends to peak. It’s a big trigger event. Overspending is an issue. We all want to make it a happy festive period by buying gifts and sharing, as well as parents trying to do lots for their children.”
As costs pile on top of one another, it can be difficult to discern the best ways to reduce spending with so many pieces of advice at your fingertips. Here are eight easy ways to combat the Christmas costs this year.
Budget. Budget. Budget
Before the Christmas shopping season begins, it is important to set aside some time to look at your bank balance and decide how much money you plan to spend between now and Christmas as well as how much you’d like to spend on gifts.
Travel
Don’t forget to factor in travel, food and decorations as those costs all add up. Colette suggests looking at these expenses in line with your income and cut unnecessary items from the list. Although the idea of budgeting sounds daunting, in reality it’s very fast and easy. You can find an accessible budgeting tool at www.mabs.ie which takes about 15-20 minutes to complete. Whatever your budget is, stick to it!
Internet
The internet is your friend. Anyone can fall prey to impulse buys but they are the least cost-effective way of spending money this Christmas. The best option is to research online to find the best deals rather than wandering aimlessly around shops.
Retail Ireland revealed that last year, consumers were making more Christmas purchases in November driven in part by promotional retail days such as Black Friday and Cyber Monday. Make use of these days where prices extensively drop before they go back up.
Paper not plastic
The most expensive cards this Christmas will be credit cards. For many people, credit cards are essentially loans enabling them to live beyond their means. This is especially true during this festive commercial season which can pressurise purchasers into using them, overlooking the interest rates which can affect them further down the line. “Hold back on the credit card. Be careful and judicial when you use it,” says Colette. “It can encourage impulse purchases. It’s easy to spend. You need to consider how it’s going to impact your budget and how you will repay the interest. It’s an expensive way of spending.” The best option is to avoid borrowing altogether unless necessary, so use either cash or a debit card. This way you can enjoy Christmas without as much financial stress on your mind.
Loans
If borrowing is a necessity this Christmas, Colette suggests taking out a low interest loan from a reputable institution. “You can come to an occasion where you need to borrow,” says Collette, adding that you should only take the exact amount you need to borrow and plan how you are going to make these repayments.
You should search around to find the best deal, starting with credit unions as they can be competitive. It is also worth looking into personal microcredit schemes which entail the lending of small amounts of money at low interest rates.
It’s the thought that counts
Gifts don’t always have to be modern and expensive, often the best ones are those that have thought and care put into them. Making a gift is not only cost effective but they are often the ones that stay in the family heirlooms. Why not be creative and knit a jumper, make a cushion or compose a song? People will be moved by the time and effort you put into it. If you need help with ideas, there are hundreds of websites online to offer some inspiration.
Break with tradition
Instead of splurging out on hundreds of gifts this year, it might be better to take a more minimalist approach. This might mean focusing on one or some of the things your child really wants and setting that as your aim rather than buying more than what is actually needed. Often children are showered with gifts that are never opened or used, only to be later thrown out. Colette says, “People need to look at what they need to buy as opposed to what they want to buy. You should be prioritising your gift list of what you need.” Make sure the gifts that you are buying are ones that you are sure your children want. If this idea interests you, let your children know that the structure of gift-giving will be different this Christmas.
The gift of travel
Oftentimes, experiences are more valuable than things, which is why a family holiday can be a great Christmas present. This would be particularly useful for older and extended families who would be more open to doing something different, rather than younger children who are expecting a visit from Santa. With all of the extended family making a contribution to a holiday, the figures for your Christmas expenses could drop significantly. It is surely something worth talking about with your siblings, and will alleviate the stress of having to do Christmas shopping.
Secret Santa
Secret Santa is a great way to cut down on expenses as it limits the amount of people you have to buy for, usually at an agreed inexpensive price. Colette says, “Do you really need to buy gifts for everybody? Look at various options, sit down and have this discussion with your siblings and ask if you can do something different this year. Lots of families have the same issues but don’t necessarily want to say it.” By exchanging presents anonymously among extended family and friends, Secret Santa offers a fun and mysterious way to approach gift-giving this year, which involves all everyone.
Although this list is not exhaustive, it can act as a spring board by which you can explore different ways to save some money this Christmas, and enjoy the occasion without worry.
Overspending and its consequences can place serious psychological strain on individuals experiencing it, affecting not just themselves but those around them. It has a particularly acute effect on families, halting both parents and children from living fully as a family.
“Overspending in a family situation can cause a huge amount of difficulties that permeate the family life, says Colette. “It can lead to stress and mental health issues, they’re the main things. It can affect family life going forward. A good handle on your budget and income and would ease those burdens. Come in and talk to MABS. Help and assistance is there.”
If financing is a problem this year, it is important to remember that above all Christmas transcends the material. Although gift-giving is an important aspect of Christian life which should be celebrated, the true gifts of Christmas can’t actually be bought.
For more information about budgeting this Christmas, see www.mabs.ie