10 top budgeting tips this Christmas
We all know how easy it is to overspend in the lead-up to Christmas.
Danielle, a member of our financial counselling team, shares her ‘Top 10 Tips’ for breezing through the festive season and into 2021 with your finances on track.
Tip #1: Write down your budget.
If you write down a full year of expenses and income, you can average out those expenses that don’t occur every pay cycle, such as car registration and Christmas). This means you’ll be less likely to be left short and have to rely on credit.
Tip #2: Track your spending.
Keeping a spending diary will help you to see how you’re going with your budget AND identify any expenses you’ve forgotten or missed.
Tip #3: Stop using the credit card.
It’s easy to think you’re dealing with debt by making big payments towards your credit card, however if you keep using credit cards to make ends meet, you may not realise you’re actually getting further behind. (Not to mention all the fees!)
Tip #4: Start a savings account.
Even if you have some debt, also having a savings account helps you to afford unexpected expenses AND it can also motivate you to reduce unnecessary expenses. Seeing your savings grow can make that new shirt look less appealing!
Tip #5: Pay bills on your pay cycle.
If you pay a small amount each pay cycle towards each of your recurring expenses, you will be less likely to have to deal with an unexpected large bill and may even end up with your account in credit.
Tip #6: Introduce ‘intentional spending’.
Everyone needs an occasional treat! If you budget for these expenses you won’t accidentally derail your financial goals, and you’ll be able to really enjoy them because you’ve made them affordable.
Tip #7: Meal planning (and shopping with a list).
It can be really easy to overspend at the supermarket. By planning your meals (and shopping to a list) you’ll be surprised at what you can save—and you’ll be less likely to impulse buy. Plus you can check for all the non-perishable things that you use all the time, and only buy them when they’re on special.
Tip #8: Get your family involved.
The household budget affects everyone, so get everyone involved! Allowing young children to choose something like frozen pizza once a week, takeaway once a month or a family outing allows them to understand value, choice and the benefits of waiting for something special. Have your teenager balance the household budget: they will get an understanding of what things cost and hopefully you’ll be setting them up for life – they will know what kind of car they can afford and the risks of getting stuck on the credit card treadmill. Couples can make a set time to go over the finances and agree to combined goals – you will be working together with a clear understanding of how the household finances are going.
Tip #9: Be open about your financial goals.
If you’ve decided that 2021 is the time to get rid of your credit card or build some savings, let those you love know, so you can plan to make changes for cheaper options, eg catch ups at home instead of eating out, or just buying (or making) a gift for one (adult) family member at Christmas. You could even start a healthy family competition to improve everyone’s financial literacy.
Tip #10: Revaluate what’s really needed.
Take a look around your home; do you really need all that stuff? Selling or donating your unwanted clutter helps you become more mindful about what you and your family really need and value.
Danielle is a big fan of the Australian Government’s Money Smart website—it’s full of useful hints and tips.
An update on the Save Safe Lending campaign
On Wednesday of this week, the Australian Government introduced legislation into Parliament that will roll-back protections against unaffordable lending to individuals by banks and other financial institutions. Anglicare has signed up to the Save Safe Lending campaign, calling for these protections to be kept in place.
Tasmanians can make their voices heard by signing the petition, writing to your local MP or Senator, to the editor of your local newspaper or joining the conversation on social media using the hashtag #debtdisaster. Why not tag your local politician in your post?
If you’re experiencing financial difficulties, contact the National Debt Helpline TODAY on 1800 007 007. You’ll get straight through to one of our trained financial counsellors, and the advice you get will be simple, practical and free.