Don't get caught this Christmas

"Merry Christmas", everyone loves saying it, but there may be feelings after the festive season is finished that you wish you hadn't been so cheerful in the lead up to the fat man's visit.


It's very hard not to get carried away over the holiday season in making things 'just right' for your guests, or 'spoiling' little Johnny as it is a special time of year - and there's nothing wrong with that...after all - isn’t that what credit cards are for?? er...NO! (In fact the original use of credit cards, or Charg cards back in the 1920's was in essence to reel in extra business for merchants)


You really need to have your s&*t together over the Christmas break as temptations abound and the advertising industry is in full swing with pre-Christmas sales and post-Christmas extravaganzas, all designed to wrench further funds from you on your cards and we can all be lulled into a false sense of security as we don't see the money leave our hands - until the end of January when the dreaded credit card bill rolls in.


Now I could play the Grinch here and tell you to cut back on the trimmings, or find a cheaper way to wrap your presents in newspaper rather than expensive wrapping, or buy only one present for Johnny, instead of 6 but I won't. All those things are useful of course and there are thousands of ways to save money over Christmas but hey...we're here for a good time, not a long time, right?


But at the very least you can begin working on a strategy to get rid of some debt as quickly as possible into the New Year. Allocate some time to prepare a budget for 2015 (if you don’t have a template then email me on ian.robinson@mortgagechoice.com.au and I will send you one) and include some rigorous calculations to begin paying down the most expensive debt first, most likely the cards. Put something in place to pay more than the minimum and still continue to make payments (as you will be severely impacted if you decide to skip any payments in the current credit climate)


Put some funds aside now and over the coming 10 months or so for Christmas 2015 and you will be amazed at the ease in stress it will cause compared to this year. Aim to have one or two less debts this time next year (who needs 5 cards anyway) Work on the most expensive debts with the lowest balance first and move on and continue the process. If you can't pay it out by then, consider consolidating to one manageable payment (call us for quotes on that) so that you are not under so much pressure and your cash flow is improved.


What I am saying is it's probably too late now to do anything about your situation if you have planned or are committed to a Christmas blowout but spend some time these holidays to thinking about how you can do things differently over the next twelve months.


Above all, have a Merry Christmas and a wonderful New Year.

 

Posted in: Tips

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