Managing christmas spend is never easy. For most of us, it is the most expensive time of the year. Is there a way of managing the spend, however, and preventing it from spiralling out of control or managing to recoup expenditure?
Robert Brealey, a chartered financial planner with Abbotstone Financial Solutions, advised that although it is a little late in the day for a 12-month action plan, it is never too late to come up with a sensible last minute strategy.
His top tips in the run up to Christmas are:
- Budget –- know how much you are willing to spend and keep to it.
- Write a list of people for whom you wish to buy gifts, with an idea of an appropriate present – it prevents spontaneous last minute overspend.
- Put aside money each week rather than using the December pay cheque or your credit card.
- For more expensive purchases, consider interest-free deals to ease the pressure.
- Pre-order Christmas food to avoid last minute panic buying and to stay within budget.
“We often find this is the time of year when clients like to gift money to their children or grandchildren,” said Robert. “It is worth seeking advice if you are looking to gift more than £250 to an individual, as money given away in excess could be added to your estate in the future.
“You can give away £3,000 worth of gifts each tax year without these being added to the value of your estate. It’s known as your ‘annual exemption’. You can carry any unused annual exemption forward to the next year, but only for one year, and use more than one of these exemptions on the same person, for example, you could give your grandchild gifts for her birthday and wedding in the same tax year.”
Looking ahead, he posed these questions: “What about replenishing costs after Christmas? Is there an amount you can put away each month to prepare you for Christmas 2018? Will this be funded from existing savings and investments? What other events do you need to plan?”
Once the dust settles it is probably worth examining income and outgoings to make the most of your money… perhaps make it a New Year’s resolution?
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