Go credit free this Christmas

Wilson Luna

Have you started your Christmas shopping yet? Research reveals that Aussie shoppers are expected to spend $23 billion this silly season – and some of that is bound to increase families our already-massive credit card bill. But with the right shopping strategies you can have your fun and skip the debt – and that will really make this Christmas merry!

Isn’t it great when Christmas comes early?

For many Aussie families the recent drop in interest rates is a great big gift of breathing space in bright Christmas wrapping. With the pressure of paying the mortgage off a little bit, we can all focus on what may be one of the most difficult questions of the year: what to get everyone for Christmas!

Christmas is the time when almost everybody splurges, because we’re not buying things for ourselves. We’re good all year: we save up for the things we want, we stick to the budget, we stay out of money trouble by saying no to credit … and then the silly season rolls around, and life becomes all about getting the perfect present for our partner or the kids. Retailers know it, too – a recent survey by the Westpac-Melbourne Institute reported consumer sentiment was up 8.1 per cent, and Aussie shoppers are expected to spend $23 billion this Christmas – and retailers are rolling out the marketing programs to ensure they get hold of as much of our cash as possible.

Seeing your loved ones unwrap their presents on Christmas morning can be a lot of fun – but loading yourself up with credit debt to do it will kill any amount of Christmas cheer. While research from Dun & Bradstreet revealed that many consumers are planning to steer clear of using credit in the coming months, 40 per cent of respondents still admitted they believed they’d need to rely on credit to meet expenses they couldn’t otherwise afford this festive season. More worrying was that four in ten families believe they’ll be struggling to meet their current credit obligations in the December quarter.

Taking control of your Christmas spending makes good financial sense – but it’s also a great way to ensure you’ll truly enjoy the holiday season. Think how much happier you’ll be spending time with your family and friends when you don’t have to about what the next bill is going to look like. And unlike working out what to buy for the person who has ‘everything’, this doesn’t have to be hard work: you can start with these simple steps.

Don't finance Santa
Plan ahead to space your buying out: get wish lists from your friends and family and start shopping now. Having the time to search for the best saving on your presents will help you avoid budget blowouts, and avoid the temptation to whip the credit card out to cover a last-minute gift-buying frenzy.

Stay strong
A spokesperson from retail-environment media network TorchMedia said that their research had revealed that 58 per cent of shoppers who make shopping lists still make unintended purchases – and clever Christmas marketing aims to encourage impulse buying. Plan what you’re going to buy before you hit the shops and stick to it. Remember that this doesn’t just apply to gifts – overspending on Christmas fare is just as common, so create menu plans and stick to them to avoid wastage.

Do a pre-Christmas 'detox'
Detox all of your other expenses to free up more cash for the festive season and take back financial control in the lead up to Christmas. Plan your meals for the week ahead, reduce your grocery and petrol costs and look for ways to trim your household bills – there’s nothing wrong with wanting to have a great Christmas, and adjusting your budget to make sure everything you want ‘fits’ means you can enjoy it guilt free.

With more than a month to go until Christmas, there’s plenty of time to put aside the cash to cover your seasonal expenses – if you start now. Your really don’t need to spend a fortune on Christmas to have a good time, but it is nice to have a few of the things you like, so plan your Christmas shopping lists now and start putting some extra cash aside rather than resorting to credit … because the last thing anyone wants for Christmas is a stockingful of debt!

Author's Biography

Wilson Luna is an author, wealth adviser and founder of Your Family Your Money. Your Family Your Money’s goal is to simplify traditionally complex financial strategies, demystify financial jargon and debunk common financial myths, becoming every family’s first stop for financial advice, information and inspiration.