Planning for a joyful Christmas and a prosperous New Year

Festive spending need not tax you too much if you can make your money work for you

- Angela Tan

Some friends mentioned a few days ago that their expenses typically skyrocket in December due to their holidays overseas, Christmas parties and lavish gifts for loved ones.

"The biggest expense is the year-end holidays," says one.

There are plenty of people in the same boat. Mr Kelvin Li, co-founder and chief financial officer at Milieu Insight, a research and data analytics company, notes that Singaporeans are the most frequent travellers towards the end of the year compared with their peers in South-east Asia.

Travel might be the biggest cost but it's not the only one, by any means, as my friend knows all too well.

"The next big expense is Christmas gifts," she says. "My husband and I also love to host Christmas parties. We spend about $400 each time for a party of six to eight, and that's excluding the champagne and wine."

A whole roast turkey can cost anywhere from $73 at NTUC FairPrice and $95 at Cold Storage to more than $175 from hotels or restaurants. Include the Christmas ham and that will add a further $50 to $150.

Another friend quipped that it doesn't help that her husband's birthday also falls in December.

It's easy to get caught up in the festive spirit and lose sight of our financial goals. But with a bit of planning and self-control, we can enjoy the holidays without breaking the bank.

In fact, there is no better time than now to take stock of your financial decisions and consider the next steps.

Here are some suggestions for action:

SUPPLEMENTARY RETIREMENT SCHEME (SRS)

If you have not contributed to your SRS account this year, it is timely to do so before Dec 31 as it will qualify for tax relief in the following Year of Assessment, says Ms Lorna Tan, head of financial planning literacy at DBS Bank.

Note that a personal income tax relief cap of $80,000 applies to the total amount of all tax reliefs claimed.