How to manage your budget and spending over Christmas

The contents provided on this page are for informational purposes only and do not constitute financial advice. Consider your personal circumstances and objectives before making any financial decisions.

Christmas can bring joy, celebration, and a Santa-sized list of tempting expenses. 

In fact, Baby Boomers and Gen X are expected to be the biggest shoppers this year, expected to fork out 37.6% of the $9.3 billion Australians are anticipated to spend this 2023 Christmas season.

It can be easy to go overboard with spending during Christmas, especially when using your credit card for your Christmas shopping. That’s why we’ve come up with ways to help you manage your budget and spending over Christmas! 

Read on for tips on how you could: 

  1. Manage your Christmas debt, including fees that can come with credit cards. 
  2. Make extra money to help boost your Christmas budget.
  3. Plan your Christmas spending to get the most out of your dollar. 

Be aware of fees that can come with your payment choices 

According to a brain study by researchers at the Massachusetts Institute of Technology, using a credit card can be associated with your brain’s reward centre. This could have the effect of making it feel like a positive action every time you swipe your credit card, which might lead to spending more than planned.

This is why it can be a good idea to be mindful of how you pay for things, especially during the festive season, to minimise your Christmas debt. 

Credit cards might be a go-to payment option for Christmas shopping that can come with benefits like fraud protection and reward points, depending on your credit card provider. However, there are fees to consider when using credit cards such as:

  • Payment surcharges: Some small businesses, online retailers and restaurants will impose a surcharge when you use your credit card to make a purchase but may exclude debit cards from such fees. Some hospitality venues may also impose a surcharge on public holidays and weekends, which may be worth noting when planning your Christmas parties and summer festivities.
  • International transaction fees: When you shop online from other countries, you might face an international transaction fee, which is an extra charge (usually around 3%) on your credit card. To see what credit cards do not have these fees you can look here at Finder.
  • Interest charges: If you're only able to make the minimum payment on your credit card following your Christmas shopping, you might incur daily purchase interest fees, which can vary between 8.99% and 24.99%.
  • Cash advance fees: This occurs when you withdraw money from your credit card, like taking cash out at an ATM or bank. However, you'll also be charged interest on the withdrawn amount from the day you take it out, unlike regular credit card purchases that often come with an interest-free period. (Canstar)

These are just a few of the fees that can come with credit cards. You can find out more about other types of credit card fees to look out in our blog Aussies are swapping out their credit cards. 

Debit cards could be a good way to help you stay within your Christmas budget, as you pay for items upfront using your own funds and therefore have nothing to owe. Most debit cards also have a daily cash withdrawal limit, usually around $1000 - $2000

Whilst debit cards are convenient to use, here is a tip to keep in mind when using debit: 

  • Overdrawn Fees: For banks like Commbank you can be charged a $15 fee. For each day your account remains overdrawn, interest charges may also apply. 

If you’re short on cash or need a boost for your Christmas budget and spending, you might consider using a pay advance service like Beforepay. This can be especially beneficial when you're faced with unexpected expenses alongside your year-end financial commitments, but know it generally comes with a small fee. With Beforepay, you can expect to pay just a single fixed transaction fee that is 5% of your advance - no interest, no other fees.

Find ways to make extra money  

Making extra money could be a great way to help you give your Christmas budget and spending a boost. 

During the seasonal time there are many opportunities that can fit with your schedule and skills, such as offering services or applying for a Christmas casual job if you have spare time. 

Here are some ideas if you’re thinking about how to make extra money this festive season!  

Creative and Crafty:

  • Make and Sell Holiday Gift Boxes Online: Create personalised holiday gift boxes and sell them on platforms like Etsy or Amazon handmade.
  • Host a Virtual Experience: Offer unique experiences, such as teaching holiday-themed activities or recipes through platforms like Airbnb Experiences.

Service-Oriented Opportunities:

  • House Sitting: Look for house-sitting opportunities on websites such as TrustedHousesitters or HouseSitters
  • Outdoor Cleanup Services: Offer lawn mowing, house washing, or snow removal services to help prepare homes for the holiday season.
  • Rent Out Storage Space: Utilise websites like Store At My House or Spacer to rent out any extra storage space you have available, similar to Airbnb but for storage needs.

Hospitality and Culinary: 

  • Decorating Services: Offer to decorate people's homes for the festive season by showcasing your skills on local social media groups or task platforms.
  • Catering for Small Christmas Parties: Utilise culinary skills to provide catering packages for holiday gatherings.

Retail and Shopping-Related Opportunities:

  • Review Products Online: Join product testing programs or platforms like Amazon Vine to review items and earn extra income.
  • Personal Shopper Services: Assist others in doing their Christmas shopping by offering personal shopping services through gig platforms or local notice boards.
  • Seasonal Customer Service Roles: Keep an eye on job search websites like Indeed or Seek for Christmas casual job postings in retail stores.

For more ideas on ways to make more money check out our blog ways to earn extra money that work with your schedule.

Plan your spending 

A good way to help manage your Christmas spending is to minimise the amount of unplanned purchases that may not be in line with your budget. Typically, accommodation and gifts can become more expensive during this time of year, so timing your end of year shopping and trips can make a big difference. 

Here are some simple tips you can try to help you plan your Christmas spending, and stick to your budget!  

  • Clean out your inbox: Unsubscribe from retail newsletters that flood your inbox with tempting discounts as they can lead to impulse buying and overspending.
  • Simplify online shopping: Make it more challenging for you to shop online and cave in to impulse purchases by removing your payment information from online stores. You might be surprised by the way it can give you a moment to reconsider before making a purchase!
  • Time your shopping: Plan your Christmas shopping around end-of-year sales events such as Black Friday and Cyber Monday. These days offer some of the best deals on gifts and decorations.
  • Try online calculators: Use online calculators to plan and organise your finances for travel. Tools like the Holiday Budget Planner or a free weekly or fortnightly budget planner can help you keep track of expenses.
  • Use budgeting apps: Leverage budgeting apps to create and manage your holiday budget. You choose from a range of free budgeting apps to help you stay on track, including the budgeting tool in the Beforepay app. Try spreadsheet templates: If you're not tech-savvy or prefer a more hands-on approach, spreadsheet templates can be your best friend for planning your Christmas budget and spending. Websites like Canva and Google Sheets offer a variety of free templates that you can customise for your holiday budget.

As we get ready for the festive season, it's important to approach our spending with care. While we all aspire to be as generous as Santa, it's a good idea to establish a budget so we can manage our spending and stay in control of our finances. 

If you are struggling with debts, remember you are not alone. For support and assistance with your finances, you can explore our Financial Support and Resources page or consider checking out these websites for support:

Disclaimer: Beforepay Group Ltd ABN: 63 633 925 505 (Beforepay) allows eligible customers to access their pay and/or access their tax refund, and also provides budgeting tools. The views provided in this article include factual information and the personal opinions of relevant Beforepay staff. This article contains selected summary information only and is provided for general information purposes only. Beforepay and its related bodies corporate make no representation or warranty, express or implied, as to the accuracy, completeness, timeliness or reliability of the contents of this blog post and do not accept any liability for any loss whatsoever arising from the use of this information. Please read our Terms of Service carefully before deciding whether to use any of our services.