Christmas is a time for indulgence with plenty of food, drink and gifts to go round but this can also make it the most expensive month in the year and it can lead to a financial shock come January. With the desire to make it a perfect Christmas our good intentions to stay within budget can often go out the window.
As prices rise ahead of wages, overspending during this time of year has become even more of a problem. Research from National Debtline has revealed that 1 in 4 Brits spend more than they can afford at Christmas with families feeling the demand from children among the main causes. The research found more than a third – 17.3 million people – have already borrowed or will turn to expensive overdrafts, credit cards and catalogues to cover costs.
As Christmas fast approaches it’s still not too late to adopt a good spending strategy for any last minute shopping you have or even if you haven’t yet started! Here are our tips for smart spending this festive season to avoid going into the red.
It’s never too late for a budget
Whether you had a budget that you’ve long forgotten or haven’t yet drawn one up aim to have a maximum amount you’re willing to spend and most importantly can afford. That way you’re more likely to spend within your limits. Include all spending not just presents, such as the cost of food and drink. Don’t let yourself be pressurised – remember it’s only one day and it’ll come back around next year before you know it.
Keep track of everything you buy and how much you’re spending as you go along as this will also help to keep to budget since you’ll know what you have left to spend.
Research, research, research
Research and then research again. If you know what gifts to get then before hitting the high street do a search online and check a number of websites for the cheapest deal. This also applies to your Christmas food shop. It may not be convenient to buy all your groceries from different supermarkets but try to hunt down which will be cheapest overall. However with only a few days to go beware of last order dates and check the costs for delivery.
Added protection on purchases
Shop with a credit card for added protection. If you buy goods or services on credit you are protected under Section 75 of the Consumer Credit Act 1974 which gives you the rights to a refund from your card provider if the retailer turns you down. This is because they are jointly liable for any breach of contract or misinterpretation by the company. It removes the risk of debt if goods or services that weren’t received, were faulty or not as described. Section 75 only provides protection for purchases valued between £100 and £30,000, of which at least part of it is purchased on credit.
Pay off in full
If you do decide to use a credit card try and ensure you pay the balance off in full relatively quickly to avoid being charged interest on what you borrowed meaning you’ll end up spending more than you intended.
Try to look for alternatives when buying gifts. Sometimes a ‘do-it-yourself’ present can be cheaper than something shop bought especially when it comes to gift sets plus they’re much more exciting and sentimental. For example if you’ve seen an expensive chocolate hamper that squeezes your budget a little, consider putting one together yourself that fits the amount you want to spend.
Christmas doesn’t have to be stressful or a burden on your finances, so if you’re doing any last minute shopping follow the tips above and you’ll be much better placed financially come the New Year.