Christmas should be a time of goodwill, happiness and all things festive. But the Christmas overspend can be a real party pooper! Read on for 7 tips to keep some cash in the bank and cheer in your heart.

Follow these tips from Estelle Scholtz-Mare, head of financial wellness at Momentum, to help keep you on track:

  1. Christmas debt is a pain in the Santa pants, an important part of getting your debt under control is to know exactly where you stand in terms of your commitments. Very few people take the time to make a list of everything they owe and are going to owe by the end of the year. Put your finances under the microscope and take the time to list all of your extra expenses for December and January. This exercise alone will make you want to draw in the financial reins.
  2. Drawing up a budget is a good place to start. If you budget R1 000 for presents and there are 30 people on your list, the money is not going to go very far. Rather consider gifts for people who are closer to you. The ‘maybes’ on your list must be eliminated; a card with kind words is often all that is required to spread Christmas cheer. If you take the time to explain to family members that this year you have to skip gift exchanges to avoid debt, they won’t think any less of you — they’ll probably be relieved because chances are they’re in a similar position.
  3. Start early. Having time to choose the right gift will help you stick to a budget. You could also leave shopping until a few days before Christmas when stores put loads of things on sale to get rid of Christmas stock. Another good way to cope with the cost of presents is to buy one gift each month throughout the year. And if a gift costs you less than you expected, save the money!
  4. This year why not call a family meeting and come to a sensible arrangement regarding how much you are going to spend on the children? If, for example, there are 20 kids in the family circle, you could agree on a set amount for each child. So instead of them getting a present from each member of the family, they get two or three high-quality presents from the whole family.
  5. Watch out for lunches and social events. Another money gobbler are those pre-Christmas celebrations with your friends at trendy restaurants. Let’s face it, your usual fare at work consists of a cheese sarmie and an apple; you don’t need a three-course meal at lunchtime. Speaking of food, Christmas dinner for 20 people can easily cost R2 000, but these days, no one expects you to tackle this project on your own. One family can supply the dessert, the other the starters and you can provide the main course. Get everyone to chip in.
  6. Use your bonus to make money. If you’re lucky enough to get a thirteenth cheque, the temptation will be to spend it. But if you decide to put that money into your bond, you can double your money. For example, if you have a bond of R1 million over 20 years at 7.5% interest and you pay in an extra R16 000, it will reduce your interest by R15 000 a year! It may not seem like a fortune, but if you do this every year, you’ll save over R200 000 and reduce the term or your bond by over 4 years. And if you really need a treat, rather spend R5 000 and save the rest. If you don’t have a bond, put the money into a retirement plan, pay off short-term debt or start an education fund for your kids.
  7. If you know you’ll be relying on your credit cards and a few missed payments to cover you for the few months after Christmas, then you need to change your game plan. Maybe it’s a time for reflection and focusing on getting your financial house in order. This could mean skipping your annual holiday or cutting down on the festivities. You don’t have to be too Scroogy — don’t give up everything, just reel in the spending; you’ll do a happy dance in the new year when you don’t have to eat instant noodles for dinner every night.

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