This Christmas will be like no other. Newspapers and radio stations are busy reporting on COVID-19 restrictions and what this means for families around the country. Christmas decorations, festive food and films suddenly hold more importance in creating that happy holiday season feeling in light of so much uncertainty. And, of course, Christmas presents! We can all go spending overboard on gifts during the festive season and more so this year. With so much time being spent indoors in the past few months, online shopping has shot up - the Office for National Statistics said that since February, online sales have increased by 52%. It is easy to spend online.
Overspending at Christmas is known to have knock-on effects for financial wellbeing and that includes for young people in 2020. Nudge Global’s recent research found that 49% of 16 to 24-year olds are feeling more anxious about money than they were six months ago and that one in five (20%) of those aged between 16 and 24 are struggling to pay their bills.
So, how can we enjoy Christmas whilst also practicing positive financial behaviour? There are some basic rules:
- Set a realistic budget. This will help to make sure you don’t overspend and avoid extra worries over the holidays. It is easy to get carried away without planning in advance.
- There are some fun free activities we can still do. So why not meet up for a festive walk and see some Christmas lights?
- Avoid borrowing. Nudge Global’s research found that 34% of those with poor financial literacy are in more debt now than six months ago. It may be tempting to take advantage of a quick loan but high interest rates will ensure bite-in in January!
- Shop local and check out charity shops. There are plenty of excellent deals to be found in local charity shops, who need support now more than ever, as Miss Money Ready points out here. Low-cost gifts and donating to a good cause - everybody wins!
As well as these tips, Tim Perkins, CEO of Nudge Global, recently shared three tips for young people to improve financial wellbeing like instilling good financial habits, learning about how money works and saving funds for a rainy day.
At MyPocketSkill, we are interested in how to foster these aspects of positive financial behaviour in easy ways all year round for young people, not just at Christmas time. We think learning-by-doing is extremely important. Young people need to be given the opportunities to put these tips into action and experience the benefits of their own financial decisions. Behind the scenes, we’ve been working on an exciting new project for months to address just this that will be coming soon in 2021! Happy holidays and stay financially healthy!