January is coming to an end, and with it, the joviality and pleasantries of Christmas and the New Year! Even so, the repercussions of our spending during the festive season will probably last well into the year!

It was reported in MoneyWeek that ‘according to a YouGov report, almost half of workers struggle to make it from one payday to the next….And it’s particularly difficult in January. Christmas and New Year always ends up costing more than most people expect’*.

Even with the worst recession to hit our shores since 1948, it was reported in The Guardian Newspaper, back in December, that the British public would spend approximately £34.6bn** over the festive season; a percentage of that, I am sure, increasing theamount of  the UK‘s ever growing consumer debt; which interestingly enough, stands at £1.7 trillion, making the UK the No.1 country in the world for consumer debt!

The figures mentioned above are not really surprising considering that leading up to Christmas there were a number of D-list celebrity fronted TV adverts enticing families to buy now and pay back in 2011. I was taken aback by this, considering the state of the economy and most people’s personal finance. Currently, the average consumer debt in the UK is reportedly at £33K!*** But irrelevant of this fact I wonder how many families took up the advert offer in order to create a perfect family Christmas?  Now there is nothing wrong with wanting to have a perfect Christmas, because ultimately if there is any time in the year one should relax and enjoy the fruits of their labour it’s Christmas.  But why the need to get into debt?  Why the dog-eared determination to keep up with the Jones’? Isn’t that what got most of us into trouble in the first place – living outside our means?  There seems to be an obsessive need around Christmas for families to go ‘all out’ in order to make sure they and their kids get what they want, in order to feel like they are part of the status quo! And this feeling makes them feel secure about themselves, their family, and their life…they ultimately feel protected from criticism and pitiful eyes. And this is the reason families will happily go into debt over Christmas, year in, year out.

Family is the bedrock of any society and as such providing for, and protecting them, from any unlikely or unforeseen event is generally at the top of a family’s list. However, even though many families will willingly go into debt to provide the perfect Christmas,  birthday party, or yearly holiday, many will not take the time to put together a plan to protect their family or their future goals and dreams for them!  We protect our car and home because legally we have to, but not our greatest asset, our income, our life we don’t! Or even if one has protected it, it is not by enough.  There are numerous reasons for this ranging from its too expensive; to life insurance is a rip off. But the question one should ask themselves is how much will it cost me and my family if I don’t have cover?

Some interesting facts:

-          The average person is insured for only £45k.  Do you think this is enough cover to help your family if an unforeseen or unlikely event were  to occur?  Sickness and death are an unfortunate part of life!

-          Every two minutes a heart attack occurs somewhere in the UK****

-          1 in 3 men aged 30 will have a stroke, cancer or heart attack before the age of 65****

-          The same for 1 in 5 women of the same age****

-          Many people are not familar with the phrase ‘buy term and invest the rest’. Which basically means rent wealth (insurance protection) whilst you build wealth (investments).

Source: http://www.criticalillness.co.uk/stats.html

I don’t write this to scare anyone but to highlight the significance of providing for, and protecting the family, from the various onslaughts of life. At Christmas the importance of family is clearly evident for all to see, so why not for 2010 make an appointment to review your finances and have a FREE Financial Game Plan to make sure that that same level of importance shown towards your family at Christmas is maintained throughout the year.

Butterfly Wealth Creation is happy to arrange this for you! Simply click here stating your contact details and a date to arrange your appointment in the convenience of your home.

Don’t let the lack of financial education or understanding of financial terms stop you from protecting and providing for your family in the long term, because in this scenario ignorance is not bliss!

Wishing one and all a financially savvy 2010

FSA registered and approved represenative of Genistar

P.S. Have you set your goals for 2010? Take this survey – Goals & Dreams in 2010 - http://Survey.ButterflyWealthCreation.co.uk On completing the survey you will be gifted with two FREE tickets to attend the next Breakthrough to Financial Freedom seminar, London, UK.     (Ticket value £199.)

Sources:

(**http://www.guardian.co.uk/business/2009/dec/20/retail-stong-christmas-consumer-spending)

(***http://www.telegraph.co.uk/news/uknews/1570523/Average-Briton-is-now-33000-in-debt.html)

(**** http://www.criticalillness.co.uk/stats.html)