The following is a guest post written by Jenny from the MoneyAware team. MoneyAware are part of the StepChange Debt Charity who provide free debt advice to help you overcome your debt problems.
It’s the most wonderful time of the year! Is it really, though? It is lovely having some time to spend with family and friends but the pressure of spending can be super stressful for many.
If anything, Christmas is a bittersweet mix of anxiety and joy. What a weird combo. Not to worry though, even if you are on a budget this Christmas, or simply don’t want to spend a lot, you can still have a great time. Just like the good old days, eh?
Think about past Christmases, what do you remember? It’s rarely presents. For me it’s usually the little traditions like leaving a carrot out for Rudolf should he get peckish while visiting. At Christmas, it’s the memories that will be remembered, not material things. I know it’s a bit cheesy, but it’s true.
I’m not saying we should cancel Christmas – we just need to get the holiday back to basics. Let’s take our Christmas back from the retailers… it’s a festive revolution!
So what can you do to avoid getting into debt this Christmas? Well, if you’re all sitting comfortably… then I’ll begin.
Budget, budget, budget
Sorry to ‘Scrooge’ on you straight away but before you think about getting in the Christmas spirit, you need to set your Christmas budget. Without a budget, you can overspend easily and before you know it, you’re in the red and tempted by loans and credit cards.
Like it or not, all the boring bits of life continue around Christmas. Bills, rent, food and travel expenses are priorities that must be paid first. Once you’ve put money aside for those, see how much you have spare to spend on Christmas.
Remember, it’s just one day – will months of financial misery from overspending be worth it next year? The last thing you want is the ghost of Christmas past haunting you for the rest of the year, right? You’ll be proud of yourself come January knowing you didn’t fall prey to Christmas frenzy.
See, I’m a sensible and logical Scrooge, not a nasty one!
Ignore tempting loans and credit cards
Pressure can make it tempting to use loans and credit cards to cover presents and food that you intend to pay off in the New Year. Almost half of Brits plan on using credit cards, store cards and overdrafts to cover Christmas this year. The thing is, unless you’re planning on winning the lottery or growing a money tree, you’ll still be in the same situation as you were pre-Christmas. So, how do you intend to pay those loans off? With another loan? Do you see where I’m going with this one?
Don’t be tempted to overspend. Work out what you can afford and stick to it. Don’t create a miserable new year for yourself for the sake of trying to please others.
Be picky with your present list
On the 12th day of Christmas, my true love gave to me, 12 drummers drumming, 11 pipers piping…. I think this song is where it all started to go wrong. How can we compete with such lavish gifts? Turtle doves for Christmas? These are unrealistic standards!
Retailers must have cottoned on to this tune because they push Christmas on us from September, making it easy to get caught up in a spending frenzy. My top tips can help you avoid a spending nightmare.
- Present pressure: It’s easy to feel pressured into buying everyone a present but remember, a lot of Christmas gifts aren’t even wanted (as cheeky as it sounds!). For example, 1.5 million ‘new’ items for sale were listed on eBay on Boxing Day 2011, meaning that some people couldn’t wait to get rid of their unwanted pressies! If you’re unsure, try a ‘no unnecessary present pact’ with your friends so you can all agree not to buy for each other. It saves wasting money and you never know, they could be worrying about cash too!
- Make the cut: Budget in hand, work out who you’re buying for and set an amount for each present. If your budget doesn’t stretch then try to cut your list down.
- Get crafty: Consider DIY gifts, like batches of jam or homemade beauty products. It may seem small but it’s the gesture that counts. Plus everyone loves jam, right?
- Secret Santa: Adults tend to be more understanding about saving money at Christmas than children. So, if you do need to buy for lots of adults, try Secret Santa. Who invented Secret Santa? Whoever it was, I love them. It’s a great way to ensure that everyone gets a gift and you can set a spending limit. Perfect!
- Talk! If you’re feeling financially strained, talk to your family and friends and explain that you simply cannot afford to buy for everyone. Or, if you’re trying to cut back, perhaps offer a small, gesture present instead? My Gran used to do this and called it a Boxing Day present. I remember it as a fun, novelty thing rather than not having a big Christmas present.
Shop but don’t drop
You have your budget and present list ready – let the shopping begin! Whether you do it online or in the stores, remember these tips and tricks:
- Return: Check returns policies. Make sure you can return unwanted pressies after Christmas if needed.
- Receipts: Keep receipts and get gift receipts too for presents you’re unsure of.
- Get searching: Shop around for the best deals
- Be web savvy: Shopping online? Check it’s a legitimate website. Find customer reviews on Google and make sure you can phone the site if needed.
- Unexpected charges: Be wary of postage charges and possible delivery delays online. Some shops offer free delivery to store but then consider petrol/parking charges.
- Protect yourself: It’s better to use PayPal to pay online just in case something goes wrong. This way, they’ve got your back!
Food for thought
A key part Christmas is the food, but it doesn’t have to be a mega spending nightmare.
When doing the festive food shop, remember: you still need to eat for the rest of the month so don’t use your whole budget for one meal. On average, UK adults spend £28 each on food and drink that’s wasted at Christmas. Can you afford that? I certainly can’t. This doesn’t mean Christmas dinner should be bread and water, that’s no fun! If you shop well, you can still have a cheap but tasty meal.
- Shop basic: Buy cheap veg and take advantage of the supermarket ‘basic’ ranges. If you’re worried about people noticing that their basic carrots are not a premium ‘these carrots will change your life’ brand then simply make delicious gravy to disguise the taste (not that they taste any different!). Oh, and if you’re not going to eat something, don’t buy it (I’m looking at you, sprouts).
- Prepare: Stock up early on stuff that won’t go off like gravy mixes, drinks and Christmas puddings to help spread the cost. You could always make your own pudding if it’s cheaper – everyone loves a trifle!
- Shop around: Snacks are a key part of Christmas, you know, to ensure we all gain as much weight as possible (worry about that in January!). To get the best deals on snacks and chocolate treats try pound shops and cheaper supermarkets.
- Use your leftovers: Boxing Day food plans? Eat leftovers or make a curry out of the leftover meat!
- Ditch tradition. We’re not big on turkey at my house so we’ve had beef or chicken the past few years (look out for meat that’s reduced and then freeze it). My point is, if tradition is too costly, do your own thing instead!
Avoid unnecessary spending
Presents aside, there are many other potential spending pitfalls at Christmas, so make sure you consider these in your budget:
- Party prep: Do you really need a new outfit for that Christmas party? If you definitely do need new glad rags, see if your budget allows for it and try charity shops or eBay to pick up a bargain, or see if you can borrow a suit or frock from a friend.
- All about the tree: Christmas trees are another expense. Instead of pricey decorations you could make some with the kids and buy cheap tinsel from the market.
If you want some posh decorations next year, nab some in the January sales as they’ll all be reduced then anyway (same for Christmas cards!).
- That’s a wrap! It’s seems trendy right now for the wrapping to be better than the actual gift but it’s a waste to spend a lot on something that’ll be ripped open. Try brown paper and string for a classic look or even newspaper and tell your pals you’re simply thinking of the environment! (You eco-friendly person you!)
Have fun!
Shopping and food sorted, Christmas day is looming but this year, you’ll be prepared. Time to feel smug–well done you! Why not take this opportunity to make some traditions with the kids? Craft decorations, bake mince pies, get the PJs on early on Christmas Eve and watch festive films with a hot chocolate. Even if you’re not religious you could take your children to church so they can learn the true meaning of Christmas and even take part in a Christingle service.
Should Christmas morning arrive and you do feel short of gifts, set up a present treasure hunt so your kids can focus on finding the presents. A great tradition in the making too!
Remember, it’s your Christmas too – enjoy it! Something my mum says every year at about 5pm on Christmas day is: “all that for one day!” So, chill out, put your feet up and have a snowball!
Merry Christmas!
Oh and Happy New Year, to you AND your bank account!
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Skint Dad is having a little R&R after getting hitched to Skint Mum.
He’ll be back soon but you can check out some of the wedding pics in the meantime.
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The best Christmas finance coping strategy I have read so far, I do all of the tips already :)