The Investor: Self-Insurance Eases the Pain

But you’re not mad enough to do it, because it would take many years to build up enough savings to cover a major disaster.

You can, though, partly self-insure by choosing large excesses. In exchange for a lower premium, you cover the first, say, $500 of a claim. You bank the savings from the lower premiums and use that money for any first $500s.

This should save you money in the long run, especially if you’re more careful than average.

Another brilliant example of self-insurance was dreamt up by a US professor.

Each year, he plans to give a generous amount to a charity at the end of the year. Then, whenever an unexpected expense arises - such as a speeding fine or a dental bill - he takes that out of the donation, so it’s painless to him. In a bad year, the charity gets nothing; in a good year it gets the lot.

Speaking of gifts to charity, the following charities offer Christmas gift programmes. You buy - on behalf of a relative or friend – an item for someone in need. You get back an acknowledgement to give to the relative or friend, to show what they have “donated”.

It beats giving one another stuff we don’t need or even want.

• Caritas Aotearoa New Zealand: 0800 22 10 22 or www.caritasgifts.org.nz. “Caritas Gifts of hope, life, peace and learning help our life-changing work around the world and in Aotearoa New Zealand.”

• ChildFund New Zealand: 0800 223 111 or www.childfund.org.nz. “Camels are the perfect gift for families in need this Christmas – donate a real one and change a family’s life.”

• Christian World Service: 0800 747 372 or www.gift.org.nz. “Change overseas lives for the better. Choose from chickens, goats, water, gardens and more.It's simple, fun and it works.”

• Leprosy Mission New Zealand: 0800 862 873 or www.reallygoodgifts.org.nz. “Share the joy of changing lives the Kiwi way, by giving your loved ones Really Good Gifts for Christmas.”

• MEND NZ: 027 329 8368 or 09 407 8395 or www.mend.org.nz/giving. “Give a gift that can really uplift a disabled person in a developing country to become mobile, employable and independent!”

• Oxfam: 0800 600 700 or www.oxfamunwrapped.org.nz. “Pass the parcel with Oxfam Unwrapped this Christmas, and let the gift land where the need is greatest.”

• Salvation Army: 09 639 1120 or www.salvationarmy.org.nz/givehope. “These gifts will help provide opportunities, better living conditions, education and freedom for people overseas.”

• Save the Children New Zealand: 0800 167 168 or http://shop.savethechildren.org.nz. “You can help families earn a living, or ensure children receive education and healthcare, or food and water in emergencies.”

• TEAR Fund: 0800 800 777 or www.giftforlife.co.nz. “TEAR Fund’s Gift items transform the lives of the poorest by providing essential education, healthcare, water and other needs.”

• The Fred Hollows Foundation: 0800 227 229 or http://www.hollows.org.nz/gift-of-sight. “For $25, you can give a beautiful Gift of Sight card and help restore sight to someone in the Pacific.”

• UNICEF: 0800 537 739 or www.inspiredgifts.org.nz. “From vaccines to storybooks or water kits – whatever your Inspired gift this Christmas, it’s guaranteed to change a child’s life.”

• World Vision: 0800 24 5000 or www.worldvision.org.nz/smiles. “This Christmas a little less here goes a long way there, give a gift that changes lives.”