The festive season is a time for joy, but it can sometimes also bring a little extra financial stress. With the rising cost of essentials, many Aussies in retirement might be feeling the pinch. And it’s not your imagination – recent data from the Association of Superannuation Funds of Australia (ASFA) reveals that the cost of maintaining a comfortable retirement has increased by 3.7% in the last year. For those in retirement, managing holiday spending can help ensure a stress-free festive season.
Toby Perkins, a Certified Financial Planner® at industry superfund NGS Super, shares his helpful tips to ensure retirees manage their budgets during the holidays.
- Avoid personal debt
Credit cards and overdrafts may seem like quick solutions, but they often lead to high-interest debt. “If you need extra funds for the festive season, it might be worth considering options like your superannuation income stream instead,” advises Toby. Avoiding extra debt may help you to maintain your financial stability in the long run and help set you up for a stress-free Christmas next year.
- Plan ahead: Budget for the entire year
Although it may be too late to adjust your budget for this holiday season, now is a good time to start planning for next Christmas. “Incorporating holiday spending into an annual budget can prevent financial strain in December,” Toby suggests. By tracking your expenses throughout the year, you can identify potential savings and plan for any extra costs, such as gifts and travel.
- Review government entitlements
It’s important for you to ensure you are receiving the correct government entitlements. “If you’re receiving the Age Pension, make sure all your details are up to date,” Toby advises. Even if you’re not eligible for the Age Pension, you may qualify for the Commonwealth Seniors Health Card or state-based Seniors Cards, which can help reduce costs on health care, transport, and other services. For more information, visit the Services Australia website.
- Stay vigilant about financial security
There are two reasons to closely track your spending throughout the holiday season: 1. To ensure you stay within budget, and 2. To ensure you don’t fall victim to financial scams. The holiday season can be a prime time for financial scams, so be cautious when making purchases online.
- Prepare for post-holiday financial health
After the holidays, plan to set aside some money for future expenses or to replenish your savings. A bit of post-holiday planning will help you avoid financial stress in the months ahead – and even get you set up for next Christmas.
- Travel smart: Plan off-peak
Travel can be one of the biggest holiday expenses, especially if it coincides with peak Christmas and school holiday periods. Toby recommends traveling outside of these busy times to save money. “Off-peak travel can significantly reduce costs and make your holiday dollar stretch further,” he says. Consider planning trips in advance to secure better deals.
Planning ahead, managing debt, and reviewing entitlements can help you enjoy the festive season without financial stress. As Toby puts it, “Smart budgeting today helps ensure a more comfortable retirement tomorrow.”
For those seeking personalised advice, NGS Super’s team of financial planners is here to help guide you to a secure and joyful future. Read the NGS Financial Planning Financial Services Guide.
For further information, visit NGS Super’s website.
Toby Perkins is authorised to provide financial advice in Australia and is an Authorised Representative (Number 1002908) of Guideway Financial Services Pty Ltd, AFSL Number 420367. Any advice given in this article is general and does not consider your financial situation, needs or objectives so consider whether it is appropriate for you. Be sure to read the relevant PDS and TMD before deciding whether a financial product is right for you.
