At one time, Christmas Savings clubs were all the rage. Pay a couple of pounds a week and at Christmas, a hamper full of assorted goodies would arrive on your doorstep. For many families they were a lifeline.
Then scandal hit. Farepak, one of the biggest Christmas hamper companies went bust, leaving families facing a Christmas without their orders or their money. Other tales of woe surfaced of unscrupulous agents running off with customers money, missing orders and vastly over-inflated prices.
The Great British public understandably fell out of love with Christmas Savings Clubs and now only one major player exists in the market.
To be fair to that company, they have changed their business model and moved away from Christmas hampers and now offer mainly vouchers, selected gifts and a limited range of food related items. However, if you do buy from them be aware that you will be playing much higher prices than you would on the high street on many items not to mention that your money will be tied up in their account and not earning interest in yours.
A quick comparison between prices in the savings club and those on the high street shows some startling differences in price on popular items.
|Item||Savings Club||High Street||Difference|
|Blue V-tech Kiddizoon Duo Camera||£57.99||£39.99||£18|
|Picnic on the Patio Playhouse||£279.99||£195.49||£83.51|
|Beer Lovers Collection For Two Experience||£79||£60||£19|
When it comes to food hampers the difference is even more startling. On average, the price of a Christmas hamper from the Savings Club is about 40% more expensive than the equivalent items in the shops.
Alcohol is much the same. One wine hamper containing 13 bottles of wine costs £90 in the Christmas Savings Club catalogue. The equivalent bottles of wine retail in major supermarkets for between £3 and £4 a bottle giving a markup of around £40.
So Why Do People Use Christmas Savings Clubs?
Most people cite ease of use. Putting away a couple of quid a week is no real hardship to most people and these agencies are often run by friends or family to earn a little commission for Christmas. There is no need to shop, everything is delivered to your door.
The Drawbacks of Christmas Saving Clubs
- Prices much more expensive than in the shops
- When ordering hampers they often contain items which you wouldn’t use or from lesser known brands
- Once you start paying you are committed and your money is tied up
- No way of shopping around to get the best deal.
- Your agent could go “rogue” and not pay in your money. This has happened many times in the past.
So How Can I Save for Christmas?
Our advice is to put a little money aside each week in a local credit union or bank account. Then when Christmas comes around you will have a nice nest egg and you can shop around and get the best deal.
If you are worried you will dip into your savings you could use a notice account so you can’t withdraw the money straight away. Alternatively you could invest in gift vouchers such as Love2Shop which can be used in many different stores.