Home Christmas Are Christmas Club Savings Accounts A Good Way To Save For Christmas?

Are Christmas Club Savings Accounts A Good Way To Save For Christmas?

written by Shelley Marsh 20/11/2014
Christmas Club Savings Accounts

You have probably never even heard of a Christmas Club Savings Account.  They are an account that helps you save for Christmas by allowing you to make direct deposits of your savings during the year but you can’t access the account without penalty until Christmas time, generally from the 1st of November.  Christmas Club  Savings Accounts were really popular in the 1970s and 1980s and are now becoming harder to find.  The big banks no longer offer them but you can still find them with some of the smaller banks and credit unions.   So are Christmas Club Savings Accounts worth it?

Well, the biggest pro for a Christmas Club Savings Account is that they allow you to start a regular savings habit for Christmas, while restricting your access during the year.  Generally speaking most accounts allow you to access your money for free from the 1st of November until the 31st of January.  You can set up a direct debit from your regular account when you get paid, straight to your Christmas Club Account.  Even at $10 per week for a year you will have $520 by the time Christmas rolls around.  Another pro is that these accounts generally have no account keeping fees and when you withdraw the money it does not have to be used on Christmas, the money can be used for bills or birthday presents, whatever you like.

The downside is that if you do need to access your money before the specified period you will be penalised.  Each account has different rules around this so make sure you are aware of how your specific account works.  Also, generally speaking, the interest rate on these accounts is not as good as other types of savings accounts.

So are Christmas Club Savings Accounts worth it?  It depends what you are after, like all accounts there are pros and cons.  If you are interested in a Christmas Club Savings account make sure you shop around for the one that suits you the most.  And given each one is different make sure you understand all the terms and conditions of the one you choose.  There are also loads of other ways to save for Christmas, apart from using a Christmas Club account so click here check to some of them out.

What is your favourite way to save for Christmas?

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Disclaimer:

The information contained in this post is general in nature and does not constitute financial advice.  Please see your financial advisor for advice specific to your individual circumstances

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11 comments

Jody at Six Little Hearts 21/11/2014 at 6:17 am

I swear by these accounts!
I once bought myself a trip to the USA using one too. I think they’re particularly good for people who struggle to save.

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Renee Wilson 21/11/2014 at 6:47 am

You’re right. I’ve never heard of this before. I think I would definitely need to access the money before hand as I often buy toys on sale throughout the year. I love the idea of a separate account though. Food for thought 🙂

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Lauren @ Create Bake Make 21/11/2014 at 7:04 am

I remember my Mum having a Christmas Club account when we were growing up and it was always a big deal when the time came for her to withdraw from it and we could start our Christmas shopping. I do something similar, only with an internet savings account.

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Bec @ Seeing the Lighter Side of Parenting 21/11/2014 at 7:29 am

My Mum had a Christmas Club account! I use my fly buys points and credit card awards points to help with Christmas. It really adds up over the year.

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Shelley Marsh 28/11/2014 at 7:13 pm

Hi Bec, yes we save outs during the year too! It is exciting to figure out what you can get! This year we brought a “marriage saving” GPS for our car! It has certainly stopped the fights about how to get places!!

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Alicia 21/11/2014 at 12:12 pm

I’ve heard of Christmas clubs but bever used one. To save for christmas I do surveys throughout the year and I also save up my flybuys and everyday rewards points to use on presents or vouchers. It really helps with all those extra costs at this time of year.

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Shelley Marsh 28/11/2014 at 7:12 pm

Hi Alicia, yes I am a huge fan of converting my frequent flyers into vouchers to help pay for Christmas! I agree it certainly helps with the extra costs!!

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Bek @AuthorRebeccaMugridge 21/11/2014 at 2:17 pm

I have heard of them and this is great information, thank you. I was actually meaning to look into last year, especially as I also have 2 kids with birthdays around this time as well!

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Shelley Marsh 28/11/2014 at 7:10 pm

Yes Bek, I can imagine have kids birthdays around Christmas means things really start to add up!

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Grace 23/11/2014 at 11:56 am

Now the boys are getting older and more specific about what they want for Christmas, it’s time to tighten our belts every year. A Christmas Club account sounds like a goer. I’ll have to see if our bank does one…

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Shelley Marsh 28/11/2014 at 7:09 pm

Yes I hear you Grace on the Christmas requests becoming more specific – it is all about Frozen this year at our house!

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