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Consumer advice: Christmas savings

What’s the best way of building up savings for Christmas so you don’t get caught short?

Saving early can help you eat, drink and be merry at Christmas, so where’s the best place to put your money?

Christmas clubs operated by supermarkets are a definite option for compulsory saving. You buy vouchers throughout the year, which can then be redeemed during December and January only – and you receive about a five percent bonus. There are variations on this.

The upside: You are forced to save. You also get to choose the goods that you want and you can spend the money over several shopping trips. Some stores have special events and you can earn loyalty points.

The downside: Battling with the Christmas crowds.

Some banks offer accounts which can be used for saving – they pay a bonus rate each month if the balance in your account has increased or if you’ve made no withdrawals.

The upside: They encourage you to save and your money earns interest. It’s also there if you need it for an emergency.

The downside: Interest rates can drop, so it may not be as good as a supermarket Christmas club.

There are a few Christmas hamper providers. You select a hamper from their catalogue and arrange for a regular direct debit to pay for it. These are delivered from November through to December.

The upside: They do force you to save and the goods are home delivered so you can avoid the crowds.

The downside: It’s an expensive way to buy groceries and you may not want everything in the hamper. There are also fishhooks in the cancellation fees, so make sure you check – hamper companies can also go broke.

Sue Chetwin

CEO CONSUMER NZ

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