Christmas budgeting tips

Fiona881 was one of those unlucky enough to be affected by the Farepack disaster last year and asked: Is it worth risking a hamper company again? I am disabled and find it difficult getting out to do the shopping and it is expensive as benefits don't go to far for the Christmas food.

Jasmine Birtles: Personally, I wouldn't bother with another company. The thing is that they're not covered in the way that bank and building society accounts are so that if the company goes bust you lose your money. With savings accounts the first £35,000 of your savings are guaranteed to be returned.

There are a few things you can do. Firstly, see if there is a Credit Union near you that you could join (look at www.abcul.org to see if you have one locally) and join one of their Christmas savings schemes. They are used to taking very small amounts from savers but they give a decent rate of interest.

I believe that most of them are online now although many still just operate an over-the-counter service. Or you could simply open an online account, which you just operate from home.

Also, quite a lot of supermarkets do Christmas stamp schemes. They are in-store, I'm afraid, but it just involves putting some coins in a machine and taking out their savings stamps. You collect these through the year and then use them in-store for Christmas goodies. If you are able to get to the shops, or someone goes with you, a pound here and there might be a good way of doing it.

Scrummy_mummy: I belong to a social club where they run a thrift club every year. The advantage of that over a savings account is that I cannot access it mid-year, but the disadvantage is there is no interest added to the saved money.

So my question is: would you recommend the thrift club or another sort of saving method for next year? And as a general rule for someone on a low income (single parent), how much is it worth putting away each week?

Jasmine Birtles: It really depends on what sort of a person you are. Do you think you have the discipline not to touch your savings if you set up a special account with an ordinary bank? If you are not disciplined then it's better in the long-run to join the thrift club.

If you are disciplined enough, there are some excellent savings accounts (for example ICICI bank which is currently offering 6.41 per cent). I would open one of those accounts and put a regular amount in every month until Christmas.

As for how much to save, it really depends on what you can afford. Have a look at your budget each week. What do you think you could put aside?

For more information on Jasmine and her money saving tips, visit www.moneymagpie.com