I don't want to alarm you...but its 9 weeks to Christmas! Surely you have noticed the Christmas items sneaking into the shops, there to tempt you to get organised and get in early!
Whilst Christmas is usually a special time of the year with friends and family, the lead up to this event can also be a stressful time for some of us trying to find the "right" gift at a price that we can afford. This often leads us to making rash decisions and making impulse purchases, usually on our credit card.
So let's talk credit (and dare I say it ... budgeting!).
- Review your current financial position. Do you have an amount each week in your budget that you can "allocate" to Christmas gifts/celebrations?
- Who would you like to buy gifts for, and at what value?
- How much would you like to have to spend on Christmas celebrations - food, drink, parties?
So, now to the crunch - will your savings between now and Christmas be sufficient to cover gifts and celebrations? If not, you have two choices - cut back on gifts and celebrations to come within you budget, or consider using credit. Obviously the first choice is the wise financial decision; however, most of us will choose the latter.
If you are thinking of taking the credit option - do your homework! If possible limit the amount of credit used to the amount you can repay within the interest free period (usually 44 or 55 days on most cards). So ask yourself "how much will I have available to pay off the credit card by the end of January 2013?" Then limit your additional Christmas budget to this amount.
If you are concerned that you may not be able to pay the balance in full within the interest free period, and then look for a low interest rate credit card, and make sure you know exactly what the repayments will be and how long it will take for you to pay it off. Remember, the interest charges have just increased the amount you have spent on Christmas gifts and celebrations -so those "bargains" at the shops, may not be a great buy after all!
Let's make sure Christmas 2012 is memorable for all the right reasons, not because we are still carrying debt into mid-2013. If you need help with budgeting, or comparing credit cards or finance facilities, please contact the finance professionals at Sothertons Gladstone on 49721300.