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Although the festive season is still a month away, many are feeling the financial pressures already.

According to a study by Commonwealth Bank, in 2012 Aussies were predicted to spend over $16.2 billion on Christmas and it looks like 2013 will have similar results.

So, with many Aussies already stretched to the limit with financial commitments, you should work out how you can get through the holiday season without buckling under the pressure.

Keep spending in check

Although it is hard to resist all the sales, if you know that due to extra expenses that your cash flow will be tight over the festive season, you will need to come up with a plan to ensure that there is enough to go around. This doesn’t mean that your Christmas has to be less fun or memorable; you just need to be a smart spender.

Speak with family and friends who you are spending Christmas with about sharing food expenses or having a secret Santa instead of buying individual gifts. It may also help to create a list of expenses and start buying small amounts of food, decorations and presents each week instead of waiting until Christmas Eve where you could possibly end up making unnecessary impulse buys when you are caught up in the moment. 

Avoid the temptation to put it all on credit and worry about how to repay it later. This is not a solution and could leave you paying off your Xmas splurge well into the New Year.As there is still a month to go, now is the time to create a budget and work out your spending. Take a look at the range of online calculators available on the State Custodians website and there is also a Christmas Budget app where you can budget for Christmas gifts and holiday spending.

Your home loan is first priority

Your home loan is a long term investment worth keeping and it’s important not to lose sight of this, especially when you are planning to spend extra money.

If you are already making extra repayments on your mortgage, you may find that cutting back to the minimum repayment amount just for December could help your holiday spending. Also, if you have extra money saved in your offset account, you could use this as well.

Remember, miss a repayment and you will incur fees and if it is not made up quickly it may appear as a default on your credit report. If things are tight, ensuring that you home loan repayment is made in full and on time is of prime importance.

Keep in contact with your finance team

If you experience financial trouble over the holiday period, don’t just keep it to yourself. Contact your lender to let them know the issues. They will be looking for you to come up with a solution so think of how you are going to be able to turn things around before you call. Not only will this show that you are taking steps to try and prevent any defaults, but they may be able to negotiate an alternative option to help you.

Although you want to enjoy Christmas with your friends and family, remember not to go overboard. Nobody wants to start the year off with a financial hangover lingering over their head.