Christmas can be a financially challenging time of year. Presents are perhaps the most obvious outgoings but they are far from the only ones. It’s a time of year where we traditionally overindulge in, well…everything. From extra food to extra alcohol, presents for friends and family and the justification of Boxing Day online sales, it all comes at a cost.

There are ways to ensure that the festive season isn’t so tough financially, though – follow our top tips for enjoying Christmas without the worry of waking up to a financial hangover this Boxing Day.

Affordability and desirability are not the same – set a budget

If you can’t afford a certain lifestyle during the rest of the year, chances are that you can’t afford it over Christmas either. Set a budget and be realistic about it. If you are unsure where you begin, perhaps it’s a good time to talk to us about lifestyle financial planning!

Donate to charity

Charity donations are subject to gift aid if you are a UK taxpayer. This means that, with your consent, the Government will donate a further 25p on every £1 that you donate. Are you self-employed? Donating through your company can also be offset against your corporation tax bill.

Consider saving, not spending

Make your cash gift go further by investing it in a savings account. Money in an envelope will never accrue interest, whereas money in a savings account will. For young savers in particular, this can also be an effective way of teaching them about the value of money and helping them understand how it can grow.

Be better prepared for next year

If Christmas is going to hit you hard this year, acknowledge that. It’s been a tough year for many and people are even more likely to understand your situation this year than ever before. Don’t put your head in the sand until next year comes around and you are forced to worry again. Work out your Christmas budget, divide it by 12, and put this amount aside each month. This virtually guarantees that Christmas 2021 won’t bring quite the same headache.

Christmas may only come once a year but that’s all-the-more reason to enjoy it. Don’t ruin it worrying about your finances. For financial advice on savings and investments you can make at Christmas, and throughout the year, please get in touch.

This article does not constitute financial advice and should not be construed as such.