Christmas is here, are you actually ready?

Are you a victim of the living cost crisis and rapidly escalating interest rates?

This is the first year in what seems like a decade that we have been able to have a restriction free Christmas. Australian Retailers Association (ARA) forecast that Australians will spend $63.9 billion in the pre-Christmas sales period, up by 3% on last year. While hospitality businesses will increase by 16.3% on 2021 to over $9 billion in the run up to Christmas.

Simultaneously, many Australians are reportedly about to experience a substantial increase in repayment interest for their mortgage in 2023, when their ultra-low fixed interest rate loans jump from the sub-2 percent rate acquired during the pandemic to 5.38-6 % for the average borrower. This will cause a significant chaos in the new year to many mortgaged families and individuals, should they not have the savings to pay.
Just when you thought it couldn’t get any worse, inflation is predicted to peak at 8 % according to the RBA. And to make that even worse, a majority of the inflation is coming from food. Hail, freak weather and natural disaster has impacted the supply chain, and the rising prices are now hurting your pockets.

So how should you avoid becoming a victim?

Let’s remember this Christmas that it is not about spending lots of money, but instead it is about family and relationships. I know it sounds cheesy, but that’s the reality. It is about spending time together and enjoying each other’s company rather than breaking your bank and creating a miserable 2023.

How can you do this?

Let’s be creative this year. Rather than spending the usual fortune on gifts, why not choose a more economical yet sentimental gift. Make it yourself, perhaps with your children, and make their Christmas a joyful and heart-warming season without killing your wallet. The bigger you maintain your savings buffer, the greater ability to cope with the fluctuations of interest and inflation, smoothing out your consumption.

Sign up now to our mailing list and be the first to discover our free tips, latest articles, videos and podcasts, laden with guidance to fast track your financial knowledge development and sent straight to your inbox as soon as they’re published!