• Serendipity Team

Navigating Christmas on a single income

With the holiday season fast approaching, the pressure seems to be on to make up for the year that’s been by having the most amazing Christmas ever.

Even without a pandemic in the mix, December is typically a highly emotional time. On the one hand there is excitement and anticipation of a well-deserved break (however short lived). On the other hand, there is the stress and anxiety that comes with all the costs typically associated with Christmas time. Research by comparison site Finder has found that the average person is planning to spend $1,232 this Christmas, with women set on average to spend 39% more on presents than men. Regardless of how much you might love the holidays, that’s a significant hit to your hip pocket, especially if you find yourself on a single income for the first time.

In this article we will take a look at practical strategies that can help you to stay financially afloat, without skimping on the Christmas cheer.

7 tips to help you navigate Christmas on a single income

Have open conversations

A change in circumstances presents the perfect opportunity for establishing some new traditions and money habits, and it all starts with open communication with friends and family members. Let them know that you will be doing things a little differently this year. If you have kids this is a great time to teach them about mindful spending and that love is not measured by the number of gifts under the tree or the size of the price tag. With friends and family, don’t be afraid to speak up – whether it is to ask for support or to float some new ideas.

Start a new tradition

Speaking of new traditions, now is the perfect time to consider how you typically spend the Christmas holidays and whether there is anything you would like to change. Some ideas could be buying joint presents for family members, or making gifts a DIY or kids only affair. If you are hosting Christmas lunch or dinner get everyone to chip in and bring a dish – not only will it will save you money, but your sanity as well.

Give the gift of giving

There is no better feeling than helping someone in need. Christmas time is a great opportunity to do some volunteer work as a family or to buy gifts for those less fortunate instead of each other. You don’t have to spend a lot to make a real difference in someone’s life and it can be a great way to build relationships with your family and the local community.

Shop around

While it pays to research before buying gifts, the same goes for your utilities as well. When was the last time you updated your phone/internet/energy/home insurance/car insurance/mortgage provider? The majority of us sign up for these services and then cruise along for years, without checking if there’s something better on offer. The reality is, there are plenty of promotions and discounts around that providers use to attract new customers, but often existing customers miss out – unless they ask. So, give your service providers a call and see if they can do better. You might be surprised by their answer and the money you could save.

Avoid buy now pay later services

There’s a great deal of social pressure that comes with Christmas and those pressures are heightened even more this year. Overlay that with the new tech like Zip Pay and Afterpay allowing us to spend that little extra without having to apply for a loan, and we could all be in serious trouble. So if you are tempted to use this service – fast forward yourself to January. What is your income and cashflow looking like then? Can you afford to pay a quarter of your limit each fortnight? If you can’t, then it’s time to put down the phone and back away from the checkout, there’s other ways of getting through the holiday season.

Check out your local Buy Nothing Facebook Group

This is a great idea, regardless of what your bank balance looks like. Great for the wallet, great for the environment, great for teaching your kids a valuable life lesson: An item doesn’t have to have the price tag still stuck on it for it to be a great present! I have gotten (and given away) so many toys and other items that were in near new condition (including things like kids bikes, scooters and trampolines) If you haven’t already joined, then now is the perfect time to do so, as everyone starts to declutter before the silly season.

Make the most of cash back sites

Last but not least, if you tend to buy most of your gifts online (or if you can buy them online) be sure to check out cash back rewards sites before you make that purchase. These are sites that give you a portion of your money back when you make a purchase by using the link from their app or website. The cash back website receives a commission from the retailer for sending customers their way, and in return they share some of that commission with you. Depending on the site you use (some examples are CashRewards and ShopBack), you can have the money transferred into your bank account. A small percentage here or there may not seem like much at first, but you would be surprised at how quickly this adds up to hundreds, even thousands, of dollars.

Christmas time can place a great deal of financial pressure on families, especially those who suddenly find themselves on a single income. The good news is that there are plenty of options available to help you get through the holiday period without getting into debt, all it takes is a little courage, planning and creativity.

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What you need to know

This information is provided and produced by Serendipity Wealth Advisors. The advice provided is general advice only as, in preparing it we did not take into account your investment objectives, financial situation or particular needs. Before making an investment decision on the basis of this advice, you should consider how appropriate the advice is to your particular investment needs, and objectives. You should also consider the relevant Product Disclosure Statement before making any decision relating to a financial product.

Finder Research – Australia’s Christmas Spending Statistics 2021