Christmas Savings Clubs - how do they work ?

SusanC10

Was talking to a friend today who was telling me how she saves for Christmas. She revoluts 2 different women 2 different amounts of money each week from January to December. Then she gets a Voucher (I think) for a local gift shop from one and her cash (not sure if it is through Revolut or actual cash) back from another. But she seems to get less back in total than what she puts in. And she doesn't seem to know either of these women personally - she met them through Facebook.

Is this some sort of scam ? Are the women charging Commission?

I am very confused as to how this works. Maybe I am misunderstanding?

joebloggs32

The larger ones work on the principal of bulk buying to get the vouchers at a discount. For example, a company like argos providing €100 vouchers to the club for say €95. Argos can afford to take the hit as they make back the loss on their sales margins.

Replicate this acrosd the board and they can deliver more money back to the club members than they put in.

In the past the xmas club could profit from the interest building up during the year from their deposits, but nowadays holding cash costs you money so thats no longer a revenue stream.

Some people are happy to get back exactly what they put in. It acts as a type of piggy bank beyond their reach until xmas, but youd want to be sure you're dealing with a reputable company that doesn't go belly up.

SusanC10

This sounds like a regular person (woman) collecting money via Revolut etc on a weekly basis from people including my friend but then giving them back a Voucher or Cash for LESS than the amount put in which makes no sense to me.

Eg - €35×50 weeks gives back €1,700 when the amount put in is €1,750.

Also, where is this woman keeping everyone's money for the year ? It doesn't sound safe or secure!

okidoki987

There has been a couple of these high profile saving clubs in the UK which have gone bust over the last few years.

Everybody lost their funds which makes no sense as there was nothing bought but they said the advertising costs were main factor in not refunding people!

I always found these clubs very dodgy.

Why would someone give someone they don't know, money every week/month for 12 months just in the hope they would get vouchers and their cash back?

There's no comeback whatsoever but some people are happy to do it, just can't figure out why.

There's commission taken by these people, they also get the discounts to keep for themselves as they are buying any vouchers in bulk.

Revolut has a savings option so people should put it in there and leave in THEIR accounts until they are ready to buy for Christmas.

zell12

I thought this was about the Tesco clubcard savings or the Iceland bonus card savings (about 3%-6% extra in-store spend)

What you described is total silliness in the 21st century.

SusanC10

https://www.boards.ie/discussion/comment/118436670#Comment_118436670

No, it seems to be random women locally to my friend. She lives in a medium sized town in Munster.

They have a local FB Group and these 2 women seem to put up posts there saying that they are doing Christmas Clubs. One woman does it solely for a local Gift Shop run by another local woman. And another woman seems to just hold the money for the women (like my friend) who give it to her and then give it back in December.

I had never heard of this in my life.

I had heard of various shops etc doing it but these are just random women not businesses.

waxmelts2000

We used to have this in our work place and also at home with my mother ( Pre revolut days!`)

It's called a "manage" where you save X amount each week and the money is then saved for you by this person (who you would normally know) and they take a fee of one weeks money and then give you the cash saved for christmas !

cbreeze

https://www.boards.ie/discussion/comment/118501988#Comment_118501988

Insane! so if a person saves weekly and pays a fee of one weekly payment to the scammer they are paying negative interest on their savings. In this day and age it is sheer fraud.

Atlantic Dawn

It's for thick people, like pre-pay electricity metres.

waxmelts2000

https://www.boards.ie/discussion/comment/118676414#Comment_118676414

My mother?, the scammer NO

This was 20 years ago or so , as I said pre revolut days, internet etc etc

AndrewJRenko

My in-laws used to do this within the extended family, calling it the Xmas club. At least it was someone they knew and trusted, and the holder would keep funds in the credit union. Still seems a bit mad though - just manage your own money FFS.

0ph0rce0

https://www.boards.ie/discussion/comment/119094196#Comment_119094196

I think that's the point here. They probably can't manage it themselves.

Many people can just throw a few quid away each week no bother but there's plenty out there that have the intention to save from Jan - Dec, they save for a few weeks, or months then can't resist and blow it all on some shite, then they say ok start again Monday :D then a few weeks in they go again and so on... then come crimbo have **** all and looking for loans and stuff.

For somebody that can't fight the urge to keep blowing their cash, throwing someone a once off 35 quid or a fifty to hang onto their money is probably worth it in the long run.

A complete stranger though? seems odd indeed, that'd be a no for me.

EDIT - ONLY REALISED HOW OLD THIS THREAD IS. SORRY HAHA