Keep track of your spending without missing out on the magic this season with our top tips to avoid getting into debt this Christmas.
Christmas is a magical time of year – the bright lights, festive food, and gatherings with friends and family make it extra-special. Unfortunately, it’s also all too easy to get caught up in the excitement and lose track of your spending. In fact, MoneyHelper found that one in four of us worry about overspending and getting into debt at this time of year.
The good news is that you don’t have to go into January with buyer’s remorse – it’s more than possible to have an incredible celebration without compromising your finances. Read on for our top tips for managing Christmas debt:
Set a budget and keep track of your spending
One way to avoid facing financial difficulties this Christmas is to set a budget and stick to it. Start by calculating all your essential costs and existing debt repayments to work out how much disposable income you have left over. This way, you can put this money towards your festive fund without having to worry about coming up short with your priority bills.
Keep a running list of everything you’ve spent on the big day and compare it with your budget to ensure your costs don’t end up spiralling out of control. You might also find it easier to do your Christmas shopping alone; it can be more tempting to throw something extra into the trolley when you’re with the kids or other family members.
Manage expectations
A great Christmas doesn’t have to include expensive presents and lavish parties. Setting expectations can remove some of the stress for you and your loved ones, especially if you’re exchanging gifts with people who are in different financial situations or shopping for children who aren’t old enough to understand the value of money. Agree a set spending limit, create a Secret Santa to buy one gift instead of several, or opt for a cost-effective alternative to a gift such as a group day out.
Start shopping early
Managing Christmas debt can be made easier by planning ahead. There’s no need to wait until December to start shopping; when it comes to saving money, it’s never too early! If you spot something on sale that could make a great gift, pick it up and hide it away. This approach can help you spread the cost of Christmas throughout the year and means you can take advantage of discounts and special offers, including Black Friday and Cyber Mondays. Shopping for a lot of people? Check out any multi-buy offers to snag extra gifts.
Shop around
If you take a step back and get organised with your Christmas shopping, you can save time to shop around and ensure you find the best deals. Don’t be tempted by convenience alone; do your research both in-person and online to find gifts at the best possible price. You might even be able to earn cashback on your purchases by shopping through an affiliate website like TopCashback or Quidco. Be mindful of any added extras or extended warranties offered, especially if you’re buying electrical goods. The cost of a one-off repair could end up being much cheaper than an ongoing subscription would be. Finally, don’t ignore supermarket-own brands and offers on non-perishables. Swapping to an own label product or buying items in advance could help you stock up on all your favourite festive food and drinks for less.
Be aware of short-term loans
Be mindful if you decide to take out a loan to cover the cost of Christmas. Short-term loans can be the most expensive way to borrow and often have spiralling interest rates if you don’t pay the money back straightaway. No matter the form of credit you use, including store cards and credit cards, it’s a good idea to try and pay off that debt as soon as possible. While it might feel kinder to yourself to leave it until January, added interest and the potential stress of being chased by your creditors can make Christmas debt even harder to deal with.
What can I do if I overspend and get into debt this Christmas?
Sometimes, despite all our best intentions, we can overspend at Christmas and find ourselves in debt. If this is your situation, don’t hesitate to seek debt help and advice. Talking to an independent debt advisor can help lift some of the anxiety you’re feeling, and they’ll take you through the debt solutions available to you without passing judgement. At My Debt Plan, our team of friendly debt advisors will talk you through your options and support you to find the best debt management solution for you and your circumstances year-round.
If you’re looking for Christmas debt advice, our team is here to help. Give us a call on 0161 8260 585 or send a message to My Debt Plan today.
