Setting financial goals is really important to set family finances straight. But at Christmas time? Maybe – and your IFA may disagree – it’s time to focus on aspirations, not goals. Jason Butler, expert in financial wellbeing and writer for the Financial Times, makes a useful distinction between financial goals (which he sees as a loaded term) and financial aspirations. Aspirations can give you much needed focus and direction when it comes to your money – whereas goals may seem unachievable, or just a lot less fun! Wouldn’t it be easier this Christmas to remain mindful of your financial aspirations (what you really want and hope to manifest in your life), rather than set yourself goals that seem out of keeping with the indulgence of the festive period? Crucially, keeping these aspirations in mind may help you to temper your spending impulses – as retailers deploy all the tricks they have up their sleeves to lure you in to part with your cash. Remembering what’s really important to you this Christmas (and beyond) may steer you away from excessive, and unnecessary, spending that inevitably results in the dreaded New Year financial hangover. And the statistics speak for themselves … According to UK debt advice charity National Debtline, 7.9 million people in the UK fell into debt last January after overspending at Christmas. Presents bought on credit rose to nearly 40% contributing to the highest personal debt levels in recent history.
Reduce the gift list If you’re part of an ever-growing family (nieces, nephews, grandkids, partners, pets), your Christmas present list may reach unwieldy proportions, causing financial stress and pressure. It’s a good time to talk openly and honestly with family and friends about cutting back – it’s all about the children anyway! Why not suggest a secret Santa between family members instead, or a children-only gift list? You may find that everyone breathes a sigh of relief. Work out what you can afford Set yourself a Christmas budget and stick to it. Don’t forget to budget for food, decorations, travel, nights out (if you don’t have kids!), as well as presents. Write gift cheques Instead of handing over your money to loved ones this Christmas, you could write them a gift cheque instead. For example, why not offer a home-cooked romantic dinner for two, a picnic in the park, or a car wash, to be cashed at the recipient’s convenience? This can be a fantastic way to teach children and young adults not only sound financial management, but what Christmas is all about. Homemade gifts Give your children your focussed attention and make some gifts with them. The internet is full of ideas on creating homemade gifts – why not let your inner artist out AND have an activity that will keep the kids busy for hours. Internet Shopping Save yourself the hassle of crowded department stores and do your shopping on the Internet instead. As well as saving you the stress of the high street, you can make huge financial savings too. UK price comparison site www.pricespy.co.uk checks all known online retailers to compare prices, so you know you’re getting the best deal out there. If you feel compelled to soak up the Christmas atmosphere at the shops, pricespy’s handy app can scan barcodes in physical shops and compare prices. So while you keep your financial aspirations in mind, ask yourself what’s really important this Christmas. One of the most precious gifts we can give is the gift of time – just spending time with the people we love and the people we care about can make all the difference, to your pocket and to the people in your life. So instead of splashing out on that latest gadget that you don’t really need, or thrashing around for ideas for the grandparents who already have everything, why not bake cookies with the kids to hand out as Christmas gifts? Put the money you save into your pension, set up a fund for your children’s future, or donate to a charity. And remember: financial aspirations are for life, not just for Christmas.