It’s the most wonderful time of the year, or at least it is according to Andy Williams’ 1963 Christmas hit. While for many Christmas is a joyful time spent with friends and family, giving and receiving gifts, it’s also a source of great stress for individuals that find themselves spending money they can’t afford. Unsurprisingly, most polls show families with children under the age of 18 will spend the most: anything from £1,000 to more than £2,700 in total at Christmas. And many find themselves turning to credit cards and overdrafts or dipping into precious savings to fund their purchases.
The good news is that there are plenty of things you can do now to reduce the financial stress and avoid feeling the pinch in January. So, if you’re hoping to save up for something big in the new year, such as a new home, you don’t have to let the festive season hold you back. Here are some ideas to keep your spending on track:
Set a budget: We know this is easier said than done. Indeed, ask anybody to say how much they will spend on Christmas this year and most won’t be able to tell you. A survey by Ocean Finance found that most had “no idea” of their spend and around half had a ballpark figure in mind, which was usually about 10% wrong. But setting a budget can help to prevent spend from escalating out of control. So come up with a figure, keep track of spending and consider whether you really need every item you’re planning to buy.
Buy second hand or go homemade: They say that it’s the thought that counts, and it really does. Make up a batch of homemade chutneys or DIY mulled wine to gift to friends and family this year and we’re sure they’ll like it as much as anything else you’d usually buy. Second-hand presents are ideal for children too, especially as they’re never bothered about the original packaging. Of course, this rule doesn’t just apply to gifts either. If you want to get some new decorations for your home, you can go down this route too. Local charity shops usually have a great selection of decorations to buy at a very reasonable price.
Don’t fall for premium ranges: Spending on expensive premium food ranges soars in the weeks leading up to Christmas as we treat ourselves to the finer things in life. But before you part with more money, consider whether you need that expensive cheese or whether the one you usually have tastes good enough anyway. Or buy premium goods from the budget supermarkets instead.
Prepare food before the big day: Plenty of savings are to be had from making food before the big day. Rather than buying prepared items like Christmas cakes, puddings and sausage meats, make it yourself in advance. And keep hold of leftovers. Get creative with them, freeze them, or share with friends and neighbours.
Spread out the festive season: Even if you’ve cut back on present and food expenditures, the many festive drinks out, work dos and restaurant meals with friends and family can take its toll. Rather than squeezing them all into December, then, think about scheduling a few in the New Year. You can give gifts later that way too and take advantage of the January sales.
If you’re putting money aside for your new home, make sure you read this blog post for some handy tips on saving for a deposit. You can also find out more about our purchasing assistance schemes here.