Why so many of us can’t afford Christmas this year

A new report has confirmed what a lot of families already feel in their wallet. More than one in four British adults, around 14.3 million people, say they will struggle to afford Christmas this year.

Parents are hit the hardest, with almost one in three saying December is going to be a real stretch.

And with food prices, rent and energy costs still high, even a small Christmas can feel out of reach for many.

The research from StepChange shows how quickly money pressure builds at this time of year.

For some, it’s not just the presents or the food. It’s school events, travel, and all the small extras that add up without warning.

If you’re already worrying about money, our guide on what to do if you can’t afford Christmas can help you make a simple plan that actually works.

Borrowing is creeping back up

Around 4 million adults say they’ll need credit to cover Christmas this year.

Among those borrowing:

• Six in ten expect their borrowing to be higher than last year
• Almost nine in ten say the higher cost of living is the reason
• Over two in five think it will take more than six months to repay
• One in five say it will take more than a year

That means Christmas 2025 could still be sitting on people’s credit cards next summer.

Saving ahead is getting harder

Almost one in four people who celebrate Christmas say they haven’t been able to save anything for it this year.

At the same time, over one in three did manage to put something aside earlier in the year, which shows a clear split between households who can plan ahead and households who are just getting by.

Why debt charities expect a busy January

StepChange says Christmas always brings pressure, and every January, they see a rise in people asking for help.

Borrowing in December often feels manageable in the moment, but the stress hits when normal bills return, energy usage goes up, and there’s nothing left to fall back on.

What you can do to stay in control this Christmas

Here are simple ways to keep things manageable without feeling like you’re missing out.

Check what you can actually afford

Before buying anything, work out what’s left after the essentials. Even a 10-minute scribble on a notepad helps you build a Christmas you can handle, not one that leaves you panicking later.

Example:
If you only have £40 spare, shape your whole plan around that. It’s much better to have a calm Christmas within your limit than a stressful one built on credit.

Talk to family early

Money worries feel heavier when nobody says anything. Most people are relieved when the conversation starts.

Things that work:
Secret Santa for adults, a small limit for kids, “kids only” gifts, or agreeing a simple rule so everyone feels equal.

Make the most of what you already have

Most homes have leftover wrapping paper, half-used craft bits, unopened crackers or cupboard items that can become snacks. Using what you already own saves more money than any shop discount.

Shop smart without overspending

Deals help only if they fit your plan. If something wasn’t on your list, it isn’t a saving.

Cheaper shops like Aldi, Lidl, Poundland and Home Bargains are great for festive bits. Start there, then fill any gaps elsewhere.

Be careful with borrowing

Buy Now Pay Later feels easy, but the bill always lands. If paying it back would be tough after January, skip it.

A simple rule:
If you wouldn’t buy it with real money today, borrowing probably isn’t a good idea.

If you’re thinking of using BNPL, it’s worth reading our guide on the real cost of Buy Now Pay Later at Christmas, as it explains the traps people often miss.

Choose at least one low-cost Christmas swap

Small changes can save a lot.

You could swap turkey for roast chicken, buy supermarket own-brand puddings, get second-hand books or toys, or make homemade decorations. Kids remember fun, not price tags.

If presents are the tricky part, here’s where to find free or cheap toys and gifts for kids this Christmas without stretching your budget.

If you’re worried, get help early

StepChange offers free, confidential support for anyone struggling with debt. You don’t need to wait until things get worse.

Final thought

Millions of people are in the same boat this year. If Christmas feels harder than it used to, it’s not you. Things really are more expensive, and wages haven’t kept up.

Do what works for your family, not what adverts or Instagram make you feel you should do. A simple Christmas you can afford is always better than an impressive one you can’t.