SIX MONTHS OUT - HOW TO PREPARE FOR A STRESS-FREE FESTIVE SEASON!

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12 JULY 2019

To be honest, the yearly tradition of blaring carols and eating dozens of mince tarts is only a small guilty pleasure of mine at Christmas. To the masses, it is the yearly tradition to face impulses and financial decisions that continue to hold a not-so-jolly feeling, well into the new year.

According to The Newdaily (an Australian online paper), Australians were predicted in 2018 to spend almost $11 billion on gifts for their friends and family over the silly season, and almost 1 in 10 were expected to leave their shopping until Christmas Eve!

Based on research, this found that the average Australian will spend $573 on gifts for their family, friends, and workmates; creating a national gift expenditure of $10.7 billion - Who would have thought we are so giving!

If you’re like me, I scoffed at this. Ironically, whilst holding a cup my usual $4.80 latte from the best caffeine den in town! Now you’re probably wondering ‘why on earth would Tom bring up this detail of his coffee? The answer is plain and simple - unconscious spending.

I admit, whilst I believe my cash management techniques are savvy & ‘hip’, I too am human; and make spending decisions that are not necessarily logical or conventional to my own financial success.

But today is the day! Today, I will provide you a peep behind the curtains on my personal tips and tricks that I use and include in my close management of finances around the build-up and closing down of the festive time of year. Whilst these are mine, I must emphasise that consulting with your adviser first, is key to ensuring they work for you too!

SAVINGS GOAL
As a financial adviser, you just need to ask my wife about excel spreadsheets and how in depth I can get with these (she is my number one fan as you can imagine!). Firstly, start off by identifying an amount you are comfortable to spend across the Christmas period. I’m not just taking about gifts; actually, think of this as a savings goal for a holiday – but without the luxury destination. Think to cater for presents, outings with friends & family, cost of activities and all the things you may like or have to do whilst having some time off. Once you have this identified, put a reasonable figure on this. This could equate to quite a lot, in my case I said I wanted to save $800.00 for Christmas this year.

AUTO PILOT TRANSFERS
The easy thing to do from here is to work back with big numbers. There is no need to go into technical meltdown with this stuff, and in my case, I chose $800, which I then workout how much this is when broken across each pay cycle I plan to do this savings plan for (5 months = ($800 / 10 Payments (fortnights) = $80). Once this number is ready, I simply set an automatic transfer from my pay account, to a savings account and allow this to continue until I reach the midst of November/December time when I will need it for presents initially.

THE NAUGHTY AND NICE LIST
I’m not to the full definition of a ‘scrooge’, but I am pretty tight with my money at the best of times. There has never been an out sung rule on whether or not you need to buy gifts for people. To me, I make this a rule of thumb that I then stick by each and every year. My list includes my wife…and yep, that’s really it! Whilst there will be a need to cater for little minions in the future, it can pay off massively to ask the question; do they need it? If you don’t feel that comfortable about making the decision on your own, just talk to the person who doesn’t make the cut and explain your new intentions and make a mutual decision to ditch the gifts and focus on the enjoyment of each other’s company instead! You are possibly clearing the air of a topic that another friend or family member has also had on their mind but didn’t know how to approach it (gold star for you!!!)

JUST SAY ‘NO!’’
It is easy to get caught up in all of the end of year shenanigans whether it be with work, a club, or friends. My view on this, is that you will not physically hurt anyone by saying no when it comes to extra events or financial commitments at this time of year that you do not truly have enjoyment being a part of. I don’t mean that you must be a hermit until the festive season is over, but if you’re like me and an adult; that gives you privilege to make decisions which you can stand by the outcome of in whatever way it falls. If you feel that financially it is a strain, just be open and honest with people whether it be at work or a social gathering that you feel you can miss. I still believe as humans, one of our favourite things to gain from anyone, is honesty.

PLAN AHEAD, START EARLY
Whilst I haven’t exactly provided you with the silver bullet of financial strategies or investments, it is quite clear in the world of ever-growing complexity, sometimes it is just best to do what is easy! So, my final words of suggestion is this. Be in control for this time next, start the plans early, and let the horse run its course (I think that’s a saying?). All the best and enjoy the year ahead!!!