101. The Christmas Club Account Advantage

In the final episode of the Accelerate Your Legacy podcast, Laura Sexton, a financial coach and money mindset specialist, discusses the importance of planning and saving for holiday expenses to avoid debt. She introduces the concept of a Christmas Club account, encouraging listeners to start saving early, thereby reducing financial stress and fostering intentional money habits. Laura also announces the podcast's rebranding to Money and Career Mastery from Overwhelm to Ownership, maintaining its focus on financial freedom and legacy building. Practical tips for setting up a Christmas Club account, reflecting on holiday spending, and prioritizing future savings are shared to ensure listeners have a financially stress-free Christmas.

Christmas in July Savings Plan & Tracker

Learn more about working with Laura Sexton

· Become a master with your money. Learn more here!

· Checkout the resource library here!

Want to ask a question Laura can answer on the podcast? Connect with her here!

Send an email to Laura@AccelerateYourLegacy.com or send a DM on Instagram @accelerateyourlegacy

Elevate your coaching with daily devotionals and prayers from 'Seasoned with Salt.' Get your copy HERE!

Transcript

Laura: 0:02

Hello and welcome to the Accelerate Your Legacy podcast. I'm Laura Sexton, your trusted financial coach and money mindset specialist. Join me as we explore the world of money and money mindset while also paving the way for a lasting legacy that extends far beyond money. Together we'll eliminate stress, amplify freedom, and ensure you stop paying for your past so you can start saving for your future. If you're seeking peace in your finances, more margin in your budget, and a legacy that inspires generations to come, you're in the right place. Hello, Accelerators, Merry Christmas, and welcome to the last episode of this season on the Accelerate Your Legacy podcast. My friends, our time as an AYL community has come to an end, and we are moving on to bigger and better things. I want you to come along with me. Stay right here. Nothing's going to change. If you were subscribed to this podcast, nothing is changing for you except the picture. That you see coming up every Thursday. My friends, we are changing the name of this podcast to Money and Career Mastery from Overwhelm to Ownership. We are going to be talking about all things optimizing income, paying off debt. We're still going to be talking about leaving a legacy and building wealth. This is going to be a time for us to come together. and learn how to do things just a little bit better. If you're already subscribed to this channel, all you have to do is stay right here for next week. And if you're not already subscribed, please go ahead and click the subscribe button. I would love to show up in your podcasting platform every Thursday. So, my friends, if you were listening to this in real time, yesterday was Christmas. Merry Christmas to you, and I hope that you enjoyed your holiday. I hope that you are still getting to spend time with your friends and family and loved ones, because that's really important. And you may be asking, why in the world, the day after Christmas, I'm talking about a Christmas club account? Well, I'm doing that because I think it's really important. Americans spent more on Christmas this year than they ever have before. Which is crazy, because we have all of this inflation, and I would have thought that Christmas spending would have gone down, but I would have been very wrong. In 2023, according to the National Retail Federation, Americans spend an average of 1, 474 on Christmas related expenses. Now some of that's presents, some of that's experiences, some of that's food, but the crazy thing is that 36 percent of people went into debt for their holiday spending. According to LendingTree. And it just, it makes me so sad because we don't need to be going into debt and people that put this on their credit card, some of them are still paying it off in April and May. And what's really sad is there are people this year. At Christmas time, they're still paying for last year's Christmas time. And I don't want that to be you. So I wanted to come on here and talk about setting up a Christmas club account and doing it today. What is a Christmas Club account? Well, these were popularized during the Great Depression, and they are now offered at many credit unions and Some banks, mostly on a local, smaller bank level. This is a chance for you to put money into an account all year long, and the funds are typically locked up until a set date. Usually, the end of October, beginning of November, to ensure that money is spent only on holiday spending. Now, the reason I wanted to go ahead and talk about setting this up, yes, because I want you to start saving money at the very beginning of the year for next year's Christmas. It's crazy because people that save money for Christmas and set it aside early, and they save year round for Christmas spending, they spend on average 25 percent less because they're more intentional and less impulsive about their purchases. And that is what we aim to be here in this legacy building community. You have been in the midst of holiday craziness. Things can get overwhelming. There are many parties to go to. There are presents to purchase. There are activities. People want to go see Santa. There's so many things that you could be doing. Maybe you're spending time with your family. Maybe you're having a giant Christmas meal. I don't know exactly what it is that you are doing this year. But I do know That for most of us, Christmas can be a little bit crazy. I know this year we are trying very hard to make Christmas an intentional, calm, relaxing time. And of course, having just gone to my daughter's Christmas musical, there were a lot of kids that were sick. So while we're here, I would like for you, before you do anything else, to sit down and reflect on what it is that you liked about this Christmas season, and what it is you didn't like, and you don't want to do next year, and by doing this, you are going to be able to make it. those priority things important for next year. What is it about this Christmas that you really enjoyed? Was there something you did that you think that's a holiday tradition I would absolutely love to continue forward and do every year for the rest of my young children's life? Is there something that you saw that you can't imagine doing Christmas without? These are the important things that we want to make sure next year we put high up on our priority list so that they get done. And if we have to fund them, if it's something that's going to cost some money, maybe it's going to see Santa and getting pictures, maybe you want to go see some snow, and so you want to go sledding, Write it down so you don't forget next year. You're still in the midst of Christmas crazy. So write down what you enjoyed. At the same time, I want you to write down the things that you did not like. Was there something that you got dragged to that you said, Next year, I don't want to do it. Because I don't want it to come around next year and you'd be like, did I like, I mean, I seem to remember, I'm sure it was okay. And then you have to go to this thing again. You're like, that was terrible. I don't want to do that. Go ahead and write it down while you're still feeling the feeling and set that boundary for yourself today. Was there something that didn't happen this Christmas that you wish could have? Maybe you ran out of funds and you didn't have the money for it. Maybe you just weren't able to get your schedules aligned with the people that matter most to you. Whatever it was that was missing this Christmas. Write it down now, so next year, you can make it a priority and make sure that it happens. The whole point of this, my friends, is for you to pay attention now so you can prioritize for later. Yes, I am having you do some journaling exercises, but trust me, come this time next year, you are going to appreciate the fact that you wrote these things down and you're paying attention to them now. So, going back, that was, what did you like, what did you dislike, what did you miss this year? And what are we going to prioritize for next year? Okay, so journaling exercise done, and I'm so excited that you're still here with me. Let's talk about the benefits of a Christmas Club account. One of the main benefits is this is going to encourage intentional savings. This is a muscle that I want you to be constantly strengthening. Because if you're anything like me, savings is fun and you like that it's there, but the actual doing it and the actual savings is kind of hard. Because I could be spending that on other things that are happening right here in front of me, and if that is something that you struggle with, I have a podcast on opportunity cost and we can talk about giving up what we want most for what we want right now and how important that is, but I want you to be Intentionally saving all year long, set up the Christmas Club account, and you're going to make automatic deposits into that account. If your bank offers a Christmas Club account, they will set that up for you. These small consistent contributions will add up over time. For example, if you save just 25 a week, you are going to have 1, 300 for next Christmas. 25 a week does not sound like a lot of money, but it gives you a big result. So if you're sitting there and you're going, these are the things that I definitely want to have happen next year for Christmas, and this is the giving I want to do, and these are the presents I want to buy, or at least the people that I want to buy things for. Is 1, 300 enough? If it is, that's 25 a week. Let's get it. Let's go. By having this Christmas club account, you are going to reduce your financial stress. Is there any better reason to do something than to have less stress in your life? You're going to avoid the need to rely on a credit card or a loan during the holidays, which I hate. It's my least favorite thing about walking into my bank. They're like, get a holiday loan. I'm like, no, why would I want to add stress to my life? Stop it. But it also ensures that you have cash on hand, which can prevent your overspending. having a limit that you have set, because you've put that money aside. Specifically, you are giving yourself permission to spend this money. And you are also giving yourself permission to not overspend. Having a Christmas Club account also will help you learn good money habits. This is great for families to model intentionality and budgeting. Get your kids involved. Let them know, hey, we set money aside all year long and this is what our Christmas budget is. I know for my kids, we take them to Five Below, which if you don't have one of these, you can probably guess by the name. It is a store where things inside of it are 5 and below. Anyway, we take the kids to five below so they can buy something for each other. They have a budget. They have 20. So they can spend 5 on each of their siblings. They know what their budget is. They know what their max is, and they are able to say, okay, I know what I'm allowed to spend. And if they get to the end of their purchasing and they have extra money left over, they can take it and go buy a 15 cent piece of candy. The fact that my kids are more excited about buying something for their siblings, they want to spend every dollar that they can spend on their siblings. Instead of buying candy brings me a whole lot of joy. They know what their budget is and they are willing to spend up to that limit, even if it means they don't get candy. I love that. This is encouraging. Not only myself, but also my children to prioritize their future needs over present wants. Never give up what you want most for something that feels good right now. Another great benefit of a Christmas Club account is there are often no fees associated with this. Many banks appreciate the fact that you are intentionally saving and they want to encourage that. They will have your account set up, no feeds, and you may even earn a small amount of interest. And by small, I usually mean like 0. 05 percent, not even a whole percentage point. This is not a money making endeavor. This is a stress reduction intentional savings effort, because we want to make sure that next year for Christmas, there's no way you're using a credit card for anything at all. So we have sat down and we've prioritized what's most important for us for next Christmas, based on the things that we liked, things that we disliked, and the things that we just really missed out on this year, and we want to make sure happen next year. So how do we start saving now for that? Well, go ahead and calculate up your typical holiday spending. What did you spend this year on gifts, on travel, on meals, on decor? Was it more than you thought you were going to spend? Probably if you weren't paying attention. Is next year going to be more? Next year, I'm going to have another child that I have to buy for. So maybe we have to increase what we set aside every month, but you have to set a savings goal. This goal can change throughout the year. But for right now, look at what you spent. Again, gifts, travel, meals, decorations. What did you Spend money on this year. Did you like it? Did you not like it? Do you want to add to it? Do you want to take away from it? Calculate what you think you are going to spend next year for the holidays based on what you spent this year, and then break it into manageable weekly or monthly amounts. Step two, you're going to open the account. A great thing to do is go ahead and research local banks or credit unions for Christmas Club options. Make sure that their terms align with your goals, especially when it comes to withdrawal restrictions. If you cannot open an account at your bank, there are ways to set this up in a savings account, and I will get to that in just a moment. Then I want you, step three, to automate your contributions. Set up a reoccurring transfer from your checking account into your Christmas Club account. And then, step four, track your progress. Review your statements. Stay motivated. If you would like, I have a Christmas savings tracker that I probably should link down in the show description, so that you can just scroll down and download it. It says Christmas in July, but it would be great for this year starting today, make sure that you have money set aside. And it's always great to have a visual reminder of the progress you are making in your savings. So here's some alternatives to a Christmas club account. If a dedicated account, isn't an option in your bank. You can do a couple of different things. You can use a high yield savings account, like Laurel Road is a great option. That's where I have my high yield savings account. However, you're not going to have a lot of money in this account, and you're not going to have it in for very long. So even if it's just a regular savings account, That's okay too. You could set it aside in an envelope in your house. I would suggest having that in a safe or a lockbox of some sort. Not just having cash sitting around for anybody to come in and grab. Set yourself up with an envelope system that says every week I'm gonna set this amount of money aside. That's okay, too. Just make sure you have it set somewhere where it's safe. You can also set money aside inside a budgeting app and call it a Christmas fund category. This is what I do. I put my money just into my regular savings account and then I write it down on a piece of paper that says I moved this much money over to my Christmas fund every month. It does not have to be sophisticated. It does not have to be crazy. Although I'm now wondering if my bank does actually offer a Christmas Club account. They did not when I originally set up my bank account, and I wonder if they will have it for next year. You know what? I'm gonna go check. Any money that I have in my savings account right now, anything that is over and above My three to six month emergency fund, which I do keep close to my account. I don't have that in a high yield savings by high yield savings is for my home down payment. But anything that goes into that account, it's usually a sinking fund of some sort. So I have my three to six months of expenses set aside in one account. And then I have another savings account it's like a give and take fund, where I put money in for sinking fund things, things like Christmas, things like car repair, things like car insurance that I have to pay every six months. I just put money aside for those things into a savings account. I just write it down on a piece of paper. It does not have to be sophisticated, my friends. It just needs to be something that you get into the habit of doing. So here are a couple practical tips for you. Start by making a plan. It's really that easy. Look at what you spent this year. What did you like? What did you not like? What do you want to do again? What do you not want to do again? How much do you want to spend next year? Tell yourself what you want to do and then make that the plan. The next thing you need to do is just start small. If you're new to savings, 10 to 20 a week is okay. Start there. You have to start somewhere. 25 a week will get you 1, 300 at the end of the year. That's enough. I don't care who you are. I mean, unless you're taking your entire family to Tahiti for Christmas. 1, 300 can be enough to have a very good Christmas. If you are more sophisticated in your savings and you have more margin in your budget, you can go ahead and make bigger weekly contributions. But start small, just get started. And then remember, next year, go ahead and shop early. You can start your holiday spending as soon as the Christmas Club account opens, which again is usually at the end of October, beginning of November. So you'll have that money there for Black Friday, don't worry. But you've already made a plan on how much money you're going to spend. You already know who you're going to be shopping for. So go ahead and start your holiday shopping a little bit earlier so you can avoid any last minute or higher cost purchases. Friends, I am so excited that you have been here with me on this Accelerate Your Legacy journey. I look forward to continuing with you into the Money and Career Mastery from Overwhelm to Ownership podcast. And I'm so excited that we are starting today on the things that matter most to us. paying attention, saying, okay, this is what I loved about this Christmas, and this is what I loved less about this Christmas. And these are the things that I'm going to make a priority to do in the future. My friends, you have the ability to do big, things. You have the ability to save money for Christmas next year, to have the most beautiful, amazing Christmas that you've ever had. That's not going to result in payments. It's not going to result in financial stress. It's not going to result in you paying interest on a gift, because that's gross. The next time I see you, it will be 2025. We will be celebrating the end of a great year, the beginning of an even better year. And we are going to be walking into a new chapter of this podcast. Again, you don't have to do anything. This RSS feed is going to stay the same. The artwork is going to be different. I will see you next week, my friends. Again, Merry Christmas, Happy New Year, go out and make a difference. Thank you for investing your time with us today on the Accelerate Your Legacy podcast. Remember, your legacy isn't just measured in dollars and cents, but in the tools, habits, mindset, and reputation you leave behind. Don't just listen to the show, but take action on what you've learned. Share this wisdom with a friend who can benefit and help us spread the word by rating and reviewing the podcast. For questions or encouragement, reach out to me on Instagram at Accelerate Your Legacy or explore the resources listed in the show notes. I will be back with you next week. Until then, build your legacy with intention.