Here’s a timely reminder ahead of the festive season: Placing pressure on yourself to ‘treat’ your whānau will only cause you more stress during what should be a joyful time.
According to Infometrics data, the NZ economy expanded further in the September 2023 quarter – but the momentum has slowed. Pressures on the primary sector are beginning to hit provincial economies, with challenges set to undermine economic activity including a continued dip in job ads, higher unemployment, a hike in on-farm costs combined with lower revenue, and falling construction intentions.[i]
The number of people participating in our labour force is rising in tandem with job advertising falling 4.9% in the last quarter (though firms are still hiring). The hardest hit jobs align with the reports of higher unemployment, with vacancies for labourers and machine operators/drivers taking a tumble. Hawke’s Bay was one of only three regions where skilled job vacancies didn’t fall in the September quarter; regardless, online job advertisements have decreased in all regions and across all skill levels.[ii]
All to say; it’s not looking likely we’ll be starting 2024 with a fresh slate economically. A large wedge of residential fixed rate mortgages are due to roll off their historically ultra-low rates onto much higher rates, some to the tune of a threefold increase, and the management buzz words are dominated at present by the 3 R’s: redeployment, restructure and redundancy. Where the year takes us is anyone’s guess, but in the meantime a great many will need to continue being exceedingly strategic with spending, saving, and employment decisions. The days of Covid fiscal stimulus and record level employment are well in the past.
Bringing it back to the holidays… Whether you celebrate Christmas or not, this time of year is a minefield for spending. As the days get warmer and folks look to wind down into long summer afternoons with family (not to mention the increasingly aggressive sales tactics from retailers looking to hit their targets), it’s easy to dismiss logic that may have kept you on the straight and narrow the rest of the year. It’s the season of drinks after work, family and work events, and for many, travelling to visit loved ones.
If the countdown of how many paydays are left until Christmas is causing you to sweat, here’s some tips on how to keep gifting from breaking the bank:
1.) Organise a secret Santa for the family. This takes the pressure off the number of gifts you need to purchase, and you can set a gifting limit to make sure everyone’s on fair footing. This is great to do with larger families, where it can be hard to figure out where to start and stop for gifting.
2.) Don’t get caught up in buy now, pay later (BNPL) traps. You’re still spending the same amount of money as if you bought everything outright, and the penalties for missing a repayment can quickly rack up.
3.) Rather than hoping to avoid disappointment on the day, have a conversation earlier on with the kids about gifting limits – you could even gamify it and give them a challenge, to put together a list under “X” amount. This one’s a two-fer as it sets realistic expectations on getting the latest gadgets while reinforcing lessons you’re already teaching them about budgeting and the spending power of money. If they’re young enough for Santa… well, you’ll just have to let them know that even Santa has a budget. Think of all the kids he has to buy for!
4.) Don’t get caught up in social media ‘gifting guides’ or hauls. Comparison is the enemy of contentment, and keeping up with the Joneses is a surefire way to keep your financial goals out of reach.
Thankfully, we are still a little way out from the big day – if it’s anything like the rest of this year, it’ll come around fast!
Remember that the holidays are for spending time with your loved ones and getting at least a few days’ break to reset from the year that was. Gifts are nice, but not at the cost of you and your family’s financial stability… or your future financial plans.
For more budgeting tips around Christmas, budgeting service Sorted has a great archive of articles to help you keep your fiscal focus.
If you’re looking at the end of the year approaching and thinking you might like a second opinion on your portfolio and financial plan – no need to delay. Get in touch with a trusted, local fiduciary today to talk about your options. Remember that a burden shared is a burden halved.
by Nick Stewart (CEO and Financial Adviser at Stewart Group)
· Nick Stewart (Ngāi Tahu, Ngāti Huirapa, Ngāti Māmoe, Ngāti Waitaha) is a Financial Adviser and CEO at Stewart Group, a Hawke's Bay-based CEFEX & BCorp certified financial planning and advisory firm. Stewart Group provides personal fiduciary services, Wealth Management, Risk Insurance & KiwiSaver scheme solutions. Article no. 332.
· The information provided, or any opinions expressed in this article, are of a general nature only and should not be construed or relied on as a recommendation to invest in a financial product or class of financial products. You should seek financial advice specific to your circumstances from a Financial Adviser before making any financial decisions. A disclosure statement can be obtained free of charge by calling 0800 878 961 or visit our website, www.stewartgroup.co.nz
[i] https://www.infometrics.co.nz/article/2023-11-mr-quarterly-economic-monitor-september-2023
[ii] https://www.mbie.govt.nz/business-and-employment/employment-and-skills/labour-market-reports-data-and-analysis/jobs-online/
