5 often-forgotten festive financial tips for medics

Whether you’re an avid ‘how many sleeps until Christmas’ type or a ‘bah humbug’ scrooge, it’s hard to avoid the festivities in the run up to Christmas.

If the frantic frenzy surrounding Black Friday and Cyber Monday hasn’t already exhausted you, the nation’s clogged up roads and shopping malls in the run up to Christmas certainly will! Christmas shoppers of all ages are desperately trying to get everything done in time and within their increasingly tight budgets.

Rather than try to persuade you to be more frugal about your gift giving this year (as per most articles with a Christmas theme), here are 5 often-forgotten tips that pretty much every festive shopper can make use of at this chaotically fun time!!

Five often forgotten festive financial tips

Tip 1: Buying online safely and securely

Ethically I would encourage people to use their local independent retailers (assuming they provide good service at reasonable prices). However not everyone is blessed with a thriving local high street, and the convenience of the online giants is hard to ignore.

If, like the vast majority of us, you’re planning on shopping online this Christmas, make sure you use your common sense. Try not to use public WiFi and look for secure sites i.e. those with a small padlock symbol or https:// in the address bar.

Where possible, do not save personal information or card details for next time. If your purchase is more than £100¹, pay for it with a credit card instead of a debit card; you’ll have greater protection and additional rights under Section 75 of the Consumer Credit Act². But remember, always pay off your credit card in full each month to avoid incurring unwanted charges.

Tip 2: Cashback and reward credit cards

If you do pay your credit card bills off every month without incurring interest, then why not look at cashback or reward cards to replace or complement your existing credit card.

You can earn up to 5%³ cashback in introductory deals and up to 1%³ cashback thereafter with the American Express Platinum Cashback Everyday card. Various terms and conditions do, of course, dictate when and how much cashback you get with this card. Also remember that not everywhere accepts American Express so always carry a second card just in case.

If you fancy racking up some air miles and jet setting off around the world with possibilities of free companion tickets, then have a look at the British Airways Amex card. For every £1 spent on the card, you earn 1 Avios point. Spend £20,000 a year and you qualify for a free companion ticket for the same journey and in the same class as the ticket bought by the card holder.

Most supermarkets also offer their own credit cards. Tesco, Asda, Sainsbury’s, Waitrose, and M&S all give you something extra for using their credit card in their own stores. Personally, I use my John Lewis/Waitrose Partnership Card most of the time. When I shop in Waitrose or John Lewis, I get 1% cashback in vouchers; when I shop elsewhere (which is most of the time), I get 0.5% cashback in vouchers.

I have a deal with myself that the vouchers can only be spent on something that falls under the banner of ‘treat for me’ as a thank you from my family (even though they have no idea I do this). If I had a Tesco’s or Sainsbury’s credit card, I would just end up using the rewards to lower the food bill and, let’s face it, where’s the fun in that!

Needless to say, cashbacks and vouchers are great but they can easily become insignificant if you don’t pay off your card in full each month. Such cards typically charge an eye-wateringly high interest rate on any unpaid balance. If you have any credit card debt, prioritise paying that debt off with a 0% interest card before you start dreaming of what you’re going to spend your cashback rewards and vouchers on.

You’d be wise too to keep abreast of the best deals and any changes to existing deals, especially in light of the recent interest rate rise.

Tip 3: Delay Christmas!

I don’t mean writing to Santa and asking him to arrive in August, but you could take advantage of the post-Christmas discounts.

Gift cards are ideal for this. The receiver can bag themselves some bargains in the January sales, making your generous gift go that bit further. Plus, if the recipient lives too far away to hand deliver, just think of the postage costs and Post Office queuing you’ll save. All you have to do is pop a stamp on the envelope and off it goes!

Tip 4: Philanthropy

We can’t all set up multi-million pound charities like the Chan Zuckerberg Initiative or Bill Gates Foundation, but we can remember that Christmas is a time for giving to those in need. If you’re a higher or additional rate tax payer and you make charitable donations, you can claim the difference between the rate you pay and the basic tax rate on your donation i.e. 20% or 25%.

For example, if you donate £100 to charity, the charity claim an extra £25 (i.e. 20%; the basic tax rate) to make your donation £125. If you pay tax at 40%, you can claim back 20% of £125 i.e. £25. If you pay tax at 45%, you can claim back 25% of £125 i.e. £31.25.

There are two ways to do this. The first is to fill in a Self-Assessment tax return. Simple enough to do if you already have to complete a Self-Assessment. Alternatively, you can ask HMRC to adjust your tax code by phoning them and letting them know about your Gift Aid donations.

Tip 5: Keeping track of your expenses

Christmas invariably ends up costing more than expected. There’s always that small gift or decoration you weren’t planning on buying but couldn’t resist, and of course there’s the cost of all that food and drink! It all adds up so it’s worth keeping a record of how much you’re spending and on what.

Reviewing your finances certainly isn’t going to be top priority just before Christmas, but why not make it a New Year resolution. Making sure that you’re not paying over the odds for a mortgage or paying for an obsolete insurance cover could free up cash to cover the cost of next year’s Christmas.

If you haven’t reviewed your finances for over a year, don’t keep up-to-date on the deals and new financial products available, and/or feel lost about the state of your finances, make an appointment to speak to your financial adviser when all the festivities are over; they’ll steer you back onto the right track for next year’s festive fun!

On a scale of 1-10, how likely are you to spend more this Christmas than you’ve budgeted for? 1 = very unlikely, 10 = very likely. Let us know by adding a comment below.

¹ Moneysupermarket.com; ² legislation.gov.uk; ³ Moneysavingexpert.com

This article was written by Jos Major

Jos has worked in the financial services industry since 1991. She became an Independent Financial Adviser (IFA) in 1996 and joined Legal & Medical in 2002. She holds the Diploma for Financial Advisers (DipFA®), the Certificate in Mortgage Advice and Practice (CeMAP®), and the Certificate in Financial Planning (Cert PFS) qualifications, and is a Member of the Institute of Financial Services (MIFS).

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