We know, we know. The sun cream’s out, the kids are off school and Christmas could not feel further away. But it’s payday, and as of this week we’re officially under five months from the big day. The “what are we doing for Christmas this year?” messages in the family group chat will be here before you know it.
The good news is that five months out is still a brilliant time to start a Christmas sinking fund. If last month passed you by and you haven’t started one yet (it happens), you’ve lost nothing by starting with today’s pay.
Quick refresher: a sinking fund is money you set aside in small chunks for an expense you know is coming. And you can’t pretend you don’t know Christmas is coming – gifts, food, travel, parties, teacher presents, the lot. Start now and you’ve got five paydays to spread the cost across, so each contribution stays small and manageable instead of December swallowing your whole budget.
How to set up your Christmas sinking fund in five minutes
- Decide what Christmas actually costs you. Be honest, not optimistic. Gifts, food, nights out, travel, the secret Santa you’ll forget about until the day before. Add it all up and get to a total. Tip: Have a look at last year’s bank statements.
- Divide by five. Five months, five paydays. If your total is £500, that’s £100 a payday. Suddenly it doesn’t feel so scary.
- Open a separate pot. A savings pot or a separate account – anywhere it won’t get mixed up with your everyday spending. Out of sight is the whole point.
- Automate it. Set up a standing order for the day after payday so the money moves before you can spend it. December-you will be chuffed.
- Check in each payday. Plans change, guest lists grow (hello hosting duties!). A quick monthly look means you can adjust before it becomes a problem.
Five paydays is plenty
Starting in July might not feel as smug as starting in June, but it beats starting in November by a mile. Small, regular amounts between now and December will always feel better than one big hit to your budget when the festive season lands.
So before you head back out into the sunshine – what’s your Christmas number?
Want the full guide to sinking funds? Read it here.