The Post Christmas Hangover and How to Deal With It

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Avoid the dreaded post-Christmas debt

Ho ho ho-o-ld on—Christmas hasn’t even begun yet. But when those leftovers are lingering, the parties are fewer and the merry stuff is winding down, will you have a Christmas credit hangover to contend with?

Let’s not get ahead of ourselves. Because with a little forward planning, you can ensure you’re spending more of the money you actually have this season, and don’t wind up in the red when the calendar switches to January.

Make a list and a budget for everything

Yep—the good, old-fashioned way. Know exactly what you need to buy, for whom and at what cost. Then stick to it, and make purchases using cash where possible. For extra tips on Christmas budgeting, click here to read our article about not overspending this festive season.

Do you turn to credit cards at Christmas?

Start by surfacing your bank statements from last November and December. What were your main methods of payment in the categories of ‘Gifts’, ‘Christmas at home’ and ‘Socialising’? Where credit was used, did you accrue interest you could’ve avoided because credit is your default approach for the festive season?

Likewise, should you rethink Afterpay?

For the uninitiated, Afterpay is a service that allows you to take home something now and pay for overtime instalments—a digital lay-by, if you will.

Choice report that as of September 2017, Afterpay “was used to make $560 million in purchases by more than 1 million customers from a wide variety of 7200 stores.”

The newfangled way to pay has been lapped up by millennials. It’s easy to see why—it offers no interest, and performs no background checks on users. The dangers reside in the repayments; namely their direct debit nature. Along with all your other direct debits, services like Afterpay, Smartpay and zipPay can creep up on you. Once you’ve taken the item home, it can be easy to forget about the repayments side of things. These services will of course charge you if direct debits are processed unsuccessfully.

For next year…

Consider creating monthly auto transfers to save for the festive season. If you know Christmas is costing you an extra $3000 annually, then you’ll want transfer $250 per month.

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