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October 11, 2012

IconStretching your pink pound for Christmas

Once upon a time in a land, where credit was plentiful and trust was held in our banks, a new currency came to be in the kingdom of LGBT – the pink pound.

The people of this land were bubbly, beautiful and with just the right amount of brand-awareness. Sadly all were barren – doomed to frivolously flounce from one relationship to another without hope of commitment or children.

So powerful was this pink pound that it allowed the community of LGBT endless travel and a generally fabulous lifestyle which fortunately made up for lack of substance in their otherwise wonderful existence.

As time went by equality laws came to pass that meant no longer were the lives of those in LGBT shallow and without purpose for now they could have kids, get married (just about) and share property.  Alas, these laws came at a great cost, the loss of the much coveted and widely sought after pink pound.

 Myths

It’s alright I haven’t followed the rabbit down the hole to join the Mad Hatter, I am merely reflecting on the myth that is the pink pound.

It was about twenty years ago that this great vision of the pink pound was put across, more than likely by some marketing schmuck trying to glorify a market segment not yet being tapped.

The idea seems to lack a general credibility as without equality laws to protect the LGBT community, in combination with the general intolerance of the day, this sector would be far more prone to poverty.

No money in poverty though, so best to focus on the pinky ‘dinks’ (Double Income No Kids). So what if the myth did not fit with reality, these contradictions rarely hinder the marketing industry from making a buck, pink or otherwise.

Reality check

Since that time LGBT families have become a lot more visible. Unfortunately, equality came around a decade too late and just as we begin to have the liberties to enjoy our hard earned ‘pink’ pounds the country has dipped into a global recession with low interest rates, high inflation and poor credit. Meaning? It is better to spend than to save.

Consider this: if we spend our pound today we can get 100 sweets but with inflation being high we might only get 95 sweets for that same pound next year, worst still if we save that pound and earn interest on it we still might not be able to buy the 100 sweets that we can get today.

So what’s the point? The point is that everyone is very interested in our money right now, no one more so that those schmucks trying to sell us the next big thing for Christmas.

In economic terms we are all either savers or consumers (spenders). For all the savers you can stop reading here (I salute you). For all the consumers, read on for I have some tools and tips that you may wish to consider in the run up to Christmas.

Budgeting for dummies

Step 1 – Set up a table, this can be on Excel, a notebook or the back of a fag packet – whatever makes you most comfortable. You should have four or five columns across the top to reflect each period of earnings, the easiest way is probably to title your columns as months. You should now note down all your income over the next three months along with all your regular bills. Oh and don’t forget January! Try as you might (and I have tried it) you cannot live on baked beans for a whole month.

Step 2 – You should now have a table with your income at the top (inflows) and a list of your expenses (outflows) beneath it. Step 2 is then to consider all the other ad hoc activities, events, drinks, Christmas night outs, food, travel and any other ad hoc expenses over the next few months.  It really helps to look through your diary and allocate a realistic budget for each item. It is also worth considering the value of these activities and prioritising what is most important.

Step 3 – Now that you have a list of your income less your expenses you should have a total figure.  This balance indicates your residual income, which can either be saved or spent. Do not be surprised if it is negative, this is the point where you may have to loop back to step 2 and readjust some of those activities according to the priority. End of night kebab low priority, Christmas tree high priority.

As a contingency, I have a few ‘household taxes’ which I use when in need, some examples to consider … a swear box (which can be very profitable when brought in during family visits or DIY), raiding your partner’s pockets at the end of the day, offering lifts home to your friends for a small surcharge and regularly visiting the back of the sofa. Be creative for creativity leads to profitability.

Step 4 – Monitor your budget, this will encourage you to stick to it and remind you of all those budgets.

Katie’s Top Tips

I have three top tips that I would strongly recommend to anyone budgeting for Christmas:

  1. Manage your expectations.
  2. Do not drink and debt.
  3. Avoid credit cards.

Whatever the balance you have available for Christmas use it for those items which rank as most important.

I appreciate that with children it can be difficult, everything is want want want and you as a parent want to provide. But kids are dumb and will likely forget Christmas after a couple of weeks. For example, last year I bought my nephew some Lego, my brother-in-law then proceeded to spend all of Christmas Day assembling the set whilst my nephew played with the box. Lesson learned. This year he gets a box.

Sometimes short term pain is needed for long term gain so on that basis manage your own expectations. Once you manage your own expectations it is a lot easier to manage those around you.   This year me and the missus have agreed to a twenty pound budget, due to impending nuptials. Does this mean we do not love each other? Only a schmuck would answer yes.

Finally, do yourself a favour and hide the credit cards. It is better to save and spend what little you have than spend the banks money and pay it back twice over however many months. You only need to look at the global recession to see what poor cash flow management and excessive use of debt will get you.

Final Thoughts…

By my calculation twenty pounds multiplied by 100 sweets should get me about 2,000 humbugs. That just about sums up my feelings on Christmas. Good luck and happy Hanukkah.

Comments are closed.

Katie Kane

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