DAVID KOCH: Here are my 12 tips for surviving Christmas financially

It’s meant to be the season of joy, but for many Christmas can become a financial nightmare. It’s a time when spending can easily careen out of control and when those purchases made in November and December come back to bite in the new year with the arrival of the credit card bill.

For many the stress of not having the financial resources to celebrate Christmas in the manner they would like to, or feel they should, can cause so much stress that it destroys the whole meaning of Christmas.

In so many cases people forget what Christmas is really about. They believe they have to spend a lot of money they don’t have to keep up a certain image or expectation of the perfect Christmas for their family and friends.

Apart from the gifts there are all the other expenses like food, wine and decorations.

Christmas is now just so expensive. But it doesn’t have to be like that at all. The key is to be well organised and, above all, realistic. Don’t let Christmas get out of hand.

Nearly a third of Australians will take on credit card debt, 8 per cent will use Buy Now, Pay Later services and 1 per cent will take out a personal loan to pay for Christmas presents this year. Plus almost half of all Australians will dip into their savings account to pay for Christmas.

So here are my 12 tips for surviving Christmas financially.

1) Gifts which don’t cost

Be creative in your gift giving. Many parents with younger children will appreciate your gift to baby sit while they spend time alone. Do you like dogs and cats? A gift certificate to a pet owner for walking or grooming will be appreciated.

The value of the time you are able to give people far outweighs a costly gift which is quickly forgotten.

2) Make a list

Avoid a stressful and expensive supermarket scrum by planning ahead. Make a list and try to buy non-perishable items on a normal shopping trip in advance.

3) Sneaky shopper

If you don’t catch up with family until after Christmas, do all your shopping at the Boxing Day and New Year sales. You’ll save a bundle not only on gifts but also the table decorations.

4) Libby’s military operation

I am married to an amazing Christmas shopper. By the end of October Libby has completed most of the gift shopping. She compiles a list of all the relatives and groups them into teenage nephews, young nieces, brothers, sisters and so on and then buys each category the same present. She buys in bulk and starts her purchases from the middle of the year when she sees a bargain.

5) Shop online

If you can’t afford the time to shop around and compare prices, do it online. It saves time and the maddening Christmas melee around the cash register.

But don’t get stung by delivery fees. Online shopping has made it easier than ever to do the Christmas shop, but you may need to spend a certain amount for free delivery. Ensure you understand what fees apply. Click and collect is usually free.

6) Early bird stocking fillers

I shop for the small stocking fillers ahead of time — even as early as the January sales. But stick them away in a dark cupboard so the kids can’t find them! Or make Christmas treats such as white Christmas and rum balls to shove in the stocking or as a nice present on its own.

7) Luxury cards

There is nothing nicer than receiving a nice Christmas card. The only problem is they can be so expensive and if you have a lot of friends the cost can really mount up. Buy luxury Christmas cards just after Christmas and the following year friends remark how expensive they look.

8) Use reward cards effectively

If you plan on using reward cards, ensure you boost within the apps to maximise the points you can earn. Also ensure you can use any points accrued throughout the year on your Christmas shop.

Australian households with an insurance policy or mobile plan with Woolworths can receive a 10 per cent discount on one shop per month. Utilise this saving for your big Christmas shop and you could spend less without breaking the bank.

9) Ask for a price match

Many stores offer price matching or price beating, so this could help stretch your dollar and save you travelling to multiple stores.

10) Use a debit card rather than a credit card

Most banks now offer debit cards, which can be used in the same way as credit cards except you’re using your own money in your own account rather than someone else’s and paying an exorbitant interest rate for the privilege.

11) Give a charity gift

A lot of charities like World Vision and Oxfam offer gift vouchers at Christmas where you can you buy things like a chook, water hole or birthing kit for someone in need but in the name of your friend or relative. It really is the heart of the Christmas spirit — and is tax deductible to you.

12) Earn extra cash to cover Christmas expenses

The lead up to Christmas can be a great time to turn that hobby in to a money spinner. If you love knitting, craft, cooking or whatever, start a stall at the local markets or sell through local shops to earn a little extra cash to help survive Christmas.

David Koch is economic director at Compare the Market