A personal finance expert has shared a simple trick to follow if you want to make sure you don’t overspend at Christmas. For many people, the festive season is the busiest and most social time of the year, and with everything going on all at once it’s easy to lose track of your spending.
Before you know it, evenings out, gift-buying and spending that little bit extra on luxury food has racked up while your bank balance has gone right down. Thankfully, there’s a rule you can follow if you don’t want to be left cringing away from your bank balance in January – and it’s pretty simple.
Paul Stringer, director of independent financial broker Norton Finance, explained the only way to budget sensibly at Christmas is to take a ‘realistic look’ at your finances. You then have to fix an exact amount you can comfortably increase your spending by without having to limit your other areas of spending.
That last bit is crucial, as it will stop you going into debt or having to make major lifestyle cuts in order to afford extras for Christmas. The money-saving expert said the final figure should be ‘modest’ for most people – at around 15 per cent or less more than your average monthly spend.
Mr Stringer explained: “Most of us increase our spending for Christmas, but it’s best not to be too drastic. By aiming for modest increases of 15 per cent or less, you can still give yourself flexibility for the festive season without limiting other areas of spending.
“If you don’t have savings set aside and need to borrow to meet the extra costs, it’s important to decide at the outset what you think you can afford, and how long you’re prepared to take to make any repayments.”
Among its other budgeting tips for Christmas, Norton Finance recommends ‘treating yourself like a business’ by regularly reviewing your personal finances and reducing non-essential spending if you’re in danger of going over budget, using cashback schemes for your Christmas shopping to get cash back from your purchases, and making sure you don’t leave your shopping to the last minute.
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