When should you start saving for Christmas?

Saving for Christmas is one of those chores we often neglect because it involves a little more effort with the usual monthly budgeting. It’s easier to maintain existing habits than it is to create new ones. However, this isn’t going to make the Christmas shopping any easier, and as with most things, preparation is key to keeping costs low over the festive period and for mitigating any risk of cashflow shortfall.

By saving in advance, you can avoid last minute use of online loans and panic-buying Christmas presents. It also gets you thinking about Christmas in an organisational manner so prepping present lists and food requirements is more straightforward.

Why is it good to save money?

There are so many benefits of saving money, but one of the biggest advantages is that you create financial resilience. This means you can bounce back after unexpected income shocks or temporary cashflow shortfall. Instead of worrying about your finances, you feel confident in the knowledge that you can continue to meet your essential expenditure until your finances return to normal. It takes a while to build up your financial resilience and it is something that you need to try to do monthly but saving as often as you can is one of the easiest ways to do it. Other benefits include being able to treat yourself and others from time to time, improving your mental wellbeing as you are less anxious about your finances and just generally feeling more in control of your money.

When should I start saving for Christmas?

The best time to start saving for Christmas is January. This gives you the most time to get your finances in order and allows you sufficient time to rebuild your savings if you have to meet any emergency expenses throughout the year. It also means you can split the target sum over a longer period which often means more manageable saving amounts. For example, instead of saving £100 a month over 3 months, you could save just £28 a month and have the same amount ready for your shopping in December. However, we aren’t always that forward-thinking and there are so many other financial commitments throughout the year that it can be tricky to remember you need to put £20 or £50 away now for something that’s happening at the end of the year.

If you haven’t started saving already, you should start saving for Christmas as soon as possible, but take into consideration your current circumstances as this may influence your ability to save. For example, if you have a disposable income of £500 each month, you probably won’t need to save in advance for Christmas as the majority of your festive expenses can be afforded from that disposable income. If your disposable income is only £100 a month, then depending on how much you intend to spend, you’ll need to start saving a bit sooner. Ultimately, you don’t want to spend the magical holiday period stressed and anxious about your finances, so the sooner you can start saving, the better. However, you also don’t want to cause yourself unnecessary stress in the run up to Christmas because you can’t seem to save enough in advance.

Should I borrow for Christmas shopping?

If you can’t seem to get your finances in order before you have to start the Christmas shopping, it can be tempting to look at the alternatives to financing Christmas. You could look at your existing credit facilities, or search for popular payday loans that could bridge the gap until January. But in any case, remember that any borrowing will need to be repaid, and if you’re borrowing to finance non-priority purchases, you might find it difficult to meet your repayments out of your usual wages. As well as reviewing your finances for Christmas, check your financial responsibilities in the few weeks or months after Christmas. The January Blues can hit hard when the magic of Christmas wears off.

Quick tips for cutting the costs of Christmas presents

Christmas seems to be demanding bigger and better presents each year, but this isn’t always possible to facilitate. You can check out our guide to spreading the cost of Christmas, but if you’re looking for some quick tips instead, why not try the below?

Go for personal gifts over expensive presents

It can be easy to spend vast amounts of money on Christmas presents to show how much your friends and family mean to you. But expensive gifts are not the only way to demonstrate your appreciation for a loved one. By putting a little more thought into their presents, you might be able to find a gift that will really mean something to them, even if it’s relatively inexpensive. You can also get a lot of things personalised with initials or names which is often a crowd pleaser and an easy way to keep the Christmas shopping low without anyone missing out.

Use small businesses over big franchises

Small businesses can be a great place to generate ideas for unique Christmas presents and you can often find little gems at low prices that you just can’t beat elsewhere. However, always do a price comparison for more popular presents as they will probably be cheaper in big brand shops. While it’s nice to support small businesses, you also have to support your finances.

Take advantage of deals throughout the year

If you’re not great at actively saving in advance, then spreading the costs of Christmas by making purchases throughout the year when you spot a good deal can be a great compromise. Often, the sales after Christmas can save you lots of money, and together with bank holiday sales, Black Friday discounts and even end of season sales, you could probably get all of your Christmas presents bought for half the usual cost – and before December even rolls around. You will need to be organised to ensure you don’t over-buy or duplicate gifts, but this can be done with a simple note on your phone or even a dedicated list in the calendar.

Christmas is a great time of year for seeing friends and family and enjoying the little things like hot chocolates and snow. But it can be a financially difficult time for many. Saving in advance and actively trying to reduce your festive spending will make a huge difference to your overall money management and hopefully reduce the stress that comes with Christmas. Be prepared and don’t give up – your finances will thank you for it!

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