Beware the December pay trap!

EssexHebridean

kimwp said:

EssexHebridean said:

TheAble said:

EssexHebridean said:

DietIrnBru said:

Open a regular saver - divide your annual take home pay by 12 - deposit into a regular saver - 13th wage at end of the year - I do it every year and it avoid this situation.

if someone can afford to place a 12th of their monthly income into regular savers then that is always a good thing to do anyway, but it doesn't "solve" this problem in any real sense - it just creates a way around it causing problems, but also means that a false picture of savings is created. 

Imagine - someone doing that 12th of their monthly pay into  regular saver accounts, and then also budgeting properly, and not spending their December Pay before 1st January...not only do their have a proper budget to work to, but they also build a nice little pot of savings year on year! 

It must be borne in mind though EH that inevitably people's expenditure will go up in December because of Christmas. So saving up for it throughout the year seems to be a good idea.

Oh I completely agree - but should someone be spending a full month's salary on Christmas, which is what the "regular saver" idea seems to be suggesting? My personal feeling is not.  Unquestionably Christmas (and indeed other presents bought through the year for birthdays etc) should be budgeted for on a monthly basis though. 

RAS phrases it brilliantly.

if I could change just one thing about christmas, it would be to prevent the pressure in advertising. The one currently driving me nuts is Asda - "put on a show this Christmas" - or alternatively, how about not feeling like you need to "put on a show"?! If the people sitting around your table are that in need of impressing - at often huge cost - then they are probably not the right people. 

We're not here to dictate what people spend their money on.

Dictate, no, and as far as I've seen, nobody has been. Advice on spending though - absolutely, and those of us who are regulars on here do that all the time - it would be disingenuous at best, hypocritical at worst to suggest that is not what we do IMO. For the purposes of this board, we assume that the majority of folk reading it for help are in debt in some way, shape or form. In that circumstance my personal feeling is that it would be downright irresponsible to be encouraging them into the idea that spending thousands on Christmas is a good or sensible use of their funds. 

I'm afraid I also feel that external pressures are a huge cause of people overspending on Christmas - and by overspending I don't mean "spending more than most rational folk think is reasonable" - I mean specifically "spending more money that they have available in their budget". That pressure comes from all sorts of directions - advertising, social media to name but two. And indeed, it is that pressure which leads to people spending their January budget on December fun, a lot of the time, which is precisely why I started this thread in the first place,  back in 2016 (which is when the original began). 

EssexHebridean

Back on topic - and  I have indeed been paid (my boss, in her defence, checked with me whether it was OK to do so as it was easier for her to pay me this week) and the money is now sitting aside in a savings account with a reminder set on my phone to shift it back over on the 30th, and do all the relevant transfers etc then. 

MrEH is due to be paid tomorrow, and we may well simply ignore his money as he is paid directly into our joint account which only gets used for budgeted expenses anyway. I will be using the remaining December budget for any further fuel for cars etc needed up until 1st January, at which point the surplus will be transferred out as usual.
 

enthusiasticsaver

Both DH and my pensions have now been paid early for Christmas.  DHs was 10 days early and mine 9 days early.  I have not moved it but we have bought all Christmas presents paid off the credit card bill and bought the Christmas online food shop from Novembers pay so Decembers pay will just sit there until 1st January. We have a buffer for the odd expense for the last week of 2023. 

We get paid interest in our current account and we tend to be quite good on not spending money just because it is in the account so I am not bothering about moving our salaries into a different account this year. If you are tempted to anticipate salaries though it makes sense to keep it hidden in another account until the normal pay date. 

On another note we do not spend anywhere near a months income on Christmas.  I have just worked out the percentage.  We spent £1200 this year on presents, food, alcohol  and one Christmas party each and there was a bit left to buy a couple of new Christmas decorations. So less than 25% of our monthly pay. Is that unusual? 

EssexHebridean

Yes - it is the lack of interest (or rather - the very low amount of interest!) in the current account which means mine has been moved. better in my pocket than in theirs! 

Interesting one on Christmas spending - in one way I'm reluctant to stray into that territory as it doesn't entirely feel relevant to this thread and I'm also wary of more judgement/threadspoiling/point-scoring arising as a result. I will say though that we are a long way below your levels both in terms of actual spending (there are relatively few people we buy for these days however - our Mums, 4 nieces/nephews, each other, and a couple of close friends and that is the lot) and in terms of percentage. I'd expect that among the regulars on here a low percentage figure would be very far from unusual though? 

kimwp

My only additional spends at Christmas to a normal month are the work Christmas meals and maybe a bit more on petrol getting round to people, so I'm probably at the lower end of people who celebrate Christmas. 

It probably doesn't matter what the topic is at this point in the thread- people new to the topic will see the posts at the start and people familiar with the topic will only need a reminder, which they'll get from the post heading. The key imo is keeping it towards the top of the page so people see it at this time of the year (though it and EH have a mention in the  weekly email, v cool!)

EssexHebridean

...and the chat definitely keeps it bouncing up at the top of the page - so yes, good point! 

peb

And as per EHs original point, we were paid early in November and a colleague had run out of money on Tuesday, she's been lent money to go out on a jolly yesterday and paying the friend back when. we were paid again today.    Jolly was booked two months ago.  Next pay day is back to usual on the 28th January.   

stu12345_2

myself and wife got paid today.we work for same employer. usual pay date . did Xmas food shop at Tesco at 7am. the whole world was there. they must have had same idea. £120 bill for 2 weeks groceries.
we are not buying each other any pressies at all.we on a dmp

I asked wife, what you want for Xmas, she said probably the same as you, 2 weeks holiday in bed with the alarm clock binned.

we got our wish, as we both work in a school. which is closed for holidays.

we have a big biscuit tin at home which is filling up with cash for full and final settlements one day.

the tin is our stash, I don't trust folk sniffing about in our banks. even though we have no bank savings.

I know this goes against the save in a interest bearing account.

but when we get paid, we pay our bills, then go to  cashline hole in wall, withdraw some  cash and it goes in biscuit tin.

when you physically see money in cash you tend not to spend it, that's my thoughts, rather than it be numbers on your online bank statements 

TheAble

Just be aware of the possibility of theft - depends how much you're stashing in there but I wouldn't personally be comfortable with thousands in notes piling up in a big tin in my house. Agree with you in many ways though on the psychology of cash.

stu12345_2

it isn't thousands lol. if I get enough for each creditor, then each will be made an offer.then I will resave and do it again for next creditor.

I'm not sure who taught me the thinking about seeing money in cash versus digits on a screen.
may have been Dave Ramsey 
 theft is unlikely , I live in a 2 storey block of flats with secure entry.  I'm top floor.which is overlooked by posh, private houses on both front and back., then it's 20 miles of farmland and rivers and forests.

we don't even have window cleaners.in my block, it's 4 flats, my neighbours are old or nice or both.it's council flat, and the only time we had any work was new gutters with scaffolding 
 nobody has any need  for ladders.

anyone that  wants  to hire a window cleaner uses reach and pole.
I leave my windows on  first catch,  half inch for air,I have done so for 10 years 
I only fully close them if I go away overnight.

I have mostly lived in flats, and only choose a floor that is above ground. for privacy and theft reduction 
I'm in a good bit of town and live in prob the lowest crime rate county in England .

I'm in the west country. oh aar