Presents that keep giving

Investing effort and money in Christmas gifts can pay off over time, writes Anthony Keane

PRESENTS are the most expensive and stressful part of Christmas for many households, piling up unnecessary financial pressure.

Christmas shoppers sometimes put too much emphasis on finding the perfect gift, ignoring cost and commonsense, and blowing their budget.

Managing your money mindset during the festive season might enable you to enjoy it more, said dmca advisory director Tania Tonkin.

She said many people were simply trying to keep up with what others were doing.

“For some people that could mean going without more essential items, or massively overspending and racking up the credit cards,” Ms Tonkin said. “It’s a pressure cooker that can make a lot of families really stressed.”

CHEAP ISN’T NASTY

The best gift for someone is rarely the one that costs the most money.

“Think deeply about what will provide the most value to you and your family,” Ms Tonkin said.

This could include a great meal with friends or family, taking time off to do something special with the kids, a weekend away or putting money towards a big family holiday, she said.

“These are all things that will provide memories for a lot longer than the latest ‘must haves’ wrapped under the tree,” Ms Tonkin said.

“Sometimes it might be better to choose a really thoughtful, but less expensive, gift for someone, or even give them something you’ve made yourself,” she said.

“We can take the time to wrap it beautifully, or to prepare a thoughtful card.”

While you’ve missed the big discounts of last month’s Black Friday and Cyber Monday, there will still be savings available.

Ms Tonkin said spending all day chasing a discount might not be the best use of your time.

“Shop around and learn to assess what seems reasonable, but don’t obsess over it,” she said.

EXPERIENCE THIS

Socks and jocks are out and memorable experiences are in when it comes to popular gifts.

“Spending money on experiences is far more satisfying for most people,” Ms

Tonkin said.

Think about the things that your gift recipient loves doing, or do research on websites such as redballoon.com.au and giftsaustralia.com.au, which can be a good starting point to see what experiences are available.

The popular Entertainment Memberships, which started in book form decades ago but have expanded online and on to smart devices, give 20 per cent of every sale back to fundraising causes and have raised more than $84 million for them in 25 years.

They feature big discounts for meals, attractions and shopping, and a digital membership for one city for a year will cost about $70. Entertainment Membership chief operations officer Ben Newling said the savings extended across Australia, New Zealand and Bali.

“You can save up to $60 in one go off the bill – just when dining out,” he said.

KRINGLE TIME

If your family hasn’t finalised their gifts yet, consider doing a Kris Kringle or Secret Santa option where each member buys just one gift for another member – meaning each gift can be more substantial or meaningful.

New research by Paypal estimates Australians on average will buy 10 gifts costing almost $500 in total.

And one in three say they plan to do a family Kris Kringle, and two-thirds say they like the idea because it reduces stress and gives them time to put more thought into it.

Tribeca Financial chief executive officer Ryan Watson said Kris Kringle was a great way to strike a balance between present giving and not going overboard by buying all family members a present.

“Another reason why I really like Kris Kringle as a gift concept is that people don’t end up with a whole lot of gifts they probably didn’t want in the first place,” he said.

MONEY MAKES MONEY

The greatest gift may be one that multiplies the recipient’s money, and this is where investments come into play. Cash injected into a child or young adult’s savings account or super fund may not impress them too much now, but the power of compound interest will grow it into a substantial amount over several years. Parents and grandparents can use online stockbrokers and platforms to buy shares in a well-known company, or invest in global names such as Apple and Netflix.

Australian Foundation Investment Company – which spreads money over many quality stocks – has an online brochure explaining how parents and grandparents can invest for children.

A new player in this area is