For most of us, the festive period is filled with traditions. These might be cultural customs as well as quirks that your family developed and passed down to you. Over the years, your traditions become synonymous with Christmas, helping you set the mood for the upcoming festivities.
These rituals also have interesting parallels to the ways you manage your wealth and could hold some valuable lessons.
Here’s what your favourite Christmas traditions could teach you about financial planning.
1. Advent calendars and the importance of a patient approach
Although the Christmas adverts seem to start earlier every year, for many people the official countdown to the festive period begins on 1 December when they open their Advent calendar for the first time.
While they were traditionally for children, there are now all kinds of calendars for adults, with products ranging from food and drink to candles and craft kits.
For children – and some adults – it might be tempting to open all the doors right away, but this will only lead to disappointment later. Advent calendars are all about patience. As you open a single door each day, you slowly build towards Christmas and reap the rewards along the way.
Building wealth requires the same patience. Trying to take shortcuts with high-risk investments or saving more than you can realistically afford each month is like rushing to the end of your Advent calendar and could backfire.
On the other hand, small, regular contributions to your savings and investments will accumulate over time, eventually helping you achieve your goals.
2. Christmas dinner and the benefits of forward planning
Christmas dinner is the culmination of the celebration for many families. The turkey and all the trimmings take a lot of work to prepare.
If you attempt to dive in without a plan, you could be setting yourself up for disaster. For example, you may get the timings wrong and burn everything or run out of oven space. You’ll also find that everything runs much more smoothly on the day if you stuff the turkey and prepare all your vegetables beforehand.
Your finances are much the same, and without a coherent strategy, you could easily make mistakes.
You likely have big goals such as raising a family and achieving your dream retirement. To reach these aims, it’s important to plan carefully and consider how much to save each month, where to invest your wealth, and what level of pension contributions to make.
Once all this preparation is done, you can follow the plan like a recipe, and you’ll see the desired outcome.
We can help you create and review your financial plan so you’re able to approach your goals from a place of confidence and preparedness.
3. Classic Christmas films and the advantages of reliable investments
Every year, studios release new Christmas films, and while the occasional one stands the test of time, many fade into obscurity. Instead, many of us revisit old classics such as A Christmas Carol or It’s a Wonderful Life.
Sometimes, it’s nice to go with a reliable choice rather than a modern Christmas film that’s trying to reinvent the wheel, often with less than entertaining results.
It’s worth remembering this when it comes to investing. The landscape has changed a lot recently as new investments such as cryptocurrency have become more common. You might be tempted by these modern options that promise large returns overnight.
However, you may also take on significant risks, as these investments are often very volatile. In some cases, you could be left seriously disappointed if you experience notable losses.
It may be more sensible to stick with traditional investments such as stocks and shares. While still prone to market volatility, these kinds of investments are tied to the movements of the economy. As such, they may follow more reliable patterns, meaning you could be more likely to see steady long-term growth.
We can help you build a reliable investment portfolio that could keep delivering year after year, just like your favourite Christmas films.
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Please get in touch or email us at advice@mlifa.co.uk for more information.
Please note
This article is for general information only and does not constitute advice. The information is aimed at retail clients only.
All information is correct at the time of writing and is subject to change in the future.
The value of your investments (and any income from them) can go down as well as up and you may not get back the full amount you invested. Past performance is not a reliable indicator of future performance.
Investments should be considered over the longer term and should fit in with your overall attitude to risk and financial circumstances.