Avoiding Debt over Christmas and holiday season

Avoiding Christmas Debt

Saving money at Christmas is a near impossibility. It puts a great deal of pressure on your finances and can be particularly difficult if you already have debt problems. Many people find themselves paying off debt accumulated from Christmas well into the new year.

• Budget for Christmas and plan ahead!
• If you don’t already have a budget – this is the time to start one.
• It’s not just the cost of Christmas you need to prepare for!
• What to do if you fall behind your debts at Christmas

Budget for Christmas and plan ahead!

The only way to soften the blow of the festive season is to plan ahead. Setting a Christmas budget will give you an idea on how much you can afford to spend. Putting money aside for Christmas as a part of your monthly budget throughout the year will also prepare you.

If you don’t already have a budget – this is the time to start one.

Tips on Saving for Christmas:

1. Budget throughout the year to put aside money for Christmas and birthdays.
2. You might want to open a savings account that earns high interest and make monthly contributions so once the festive season arrives the money you have been budgeting for all year will have accumulated interest.
3. See what you could save by joining free loyalty schemes at supermarkets and shops.
4. Once you’ve budgeted for Christmas, divide your Christmas money amongst all your Christmas expenses so you’ll know how much you have to spend on presents, cards, food, decoration, drinks and so forth.
5. When you’ve discovered how much you have to spend of presents, write a list of everyone you’d like to buy a present for then divide your present budget amongst them so you know how much you can afford to spend on everyone before you start shopping
6. Think outside the square for ways to make gifts cheaper by making presents, cards, saving on postage by handing out cards to friends you regularly see in advance.
7. Buying heavily discounted wrapping paper and cards in the post Christmas sales is one way to prepare for next year.
8. Shop around to get the best prices on food and presents.
9. Once you know your budget – stick to it!

It’s not just the cost of Christmas you need to prepare for!

Don’t make the mistake of ignoring your debts and bills over Christmas! Unfortunately your gas bills, mortgage arrears and council tax don’t disappear when the spirit of Christmas arrives. If you find yourself in a situation where you cannot pay all your bills, pay your priority bills first. These are bills that have serious consequences – such as losing your home – if you don’t pay. Things like mortgages, rent, electricity bills, water bills and fines are all priority debts.

What to do if you fall behind your debts at Christmas

No matter how much you budget, you still may find yourself struggling to those after Christmas and new years bills that always seem to arrive at the same time. If this happens to you, read our section on debt advice, or call the Debt Advice Trust for free debt advice over the phone.