It’s the most wonderful time of the year, but what is the real cost of Christmas? Read our blog to find out more.
As Christmas is coming, it’s important to remember that Christmas is one day of the year, and it really isn’t worth putting yourself in debt over. Many people find themselves overspending at Christmas in the excitement of it all, and if you already have debts building up, this could really throw off your Debt Management Plan.
In January, 7.19 million people in the UK started their 2018 off with outstanding Christmas debt after overspending in the festive period of 2017, according to to the debt advice charity National Debtline.
Research suggests that the typical Briton would need 14 weeks to pay off their Christmas debt hangover, meaning that it would potentially take until April for the average debt of £398.19 to be paid off.
Christmas debt can take a massive toll on family life, with the financial stress the festive season can bring every year. Last Christmas, 1 in 3 people borrowed more than they did in the festive season of 2016, with 25% of people stating that they were still paying off loans from Christmas 2016.
To allow for all of this festive spending, last year:
- 43% of people spent less on themselves on the run up to Christmas
- 22% of people worked overtime
- 8% even got a second job
- Almost 50% of people spent less in January
All of this doesn’t seem to be in the true spirit of Christmas, does it? Although it can be easy to get caught up in the hype, sometimes it can be important to step back and take a look at how much you are spending in the hopes of achieving that “perfect” Christmas that will have been forgotten about by the 1st of January.
Over a quarter of people wish they had started saving earlier than they did for the festive season. If you’re concerned about the cost of Christmas, see our tips on how to avoid a financial crisis below:
- Plan early
Be realistic, and budget to your means. Figure out what you can afford to spend on each person you would like to gift, and stick to your budget.
- Remember your everyday outgoings
Make sure your priorities are in order, and don’t forget about the essentials such as mortgage or rent payments, and utility bills. Although it may be a quick fix in the short term to avoid paying one of your usual bills to allow for Christmas, this will only bring severe consequences later on.
- Don’t give into peer pressure
9.1% of people asked by uSwitch admitted that they overspend at Christmas “because of competition from other family members/friends.” None of your family or friends would want you to be in debt over gifts for them, so keep this in mind when you are shopping.
- To overdraft or not to overdraft
Try to avoid using an overdraft, but if you really do need more money, speak to your bank before taking one on to make sure you’re making the best decision for yourself financially.
- Get the best deal
Use money comparison sites to find the best price for the items you have got your eye on, and don’t be shy of using discount codes or vouchers. Follow your favourite brands on social media to watch out for any deals they have going on.
- Check the small print
If you’re going to use credit, check for any hidden extras in the small print, and make sure that any monthly payments fit into your budget.
- Get advice
If you have concerns about any festive financials or you are worried about how the Christmas period will affect your Debt Management Plan, talk to us today, we’d love to help.