Christmas is a time when many of us overspend on gifts, food and other flights of fancy, but you don’t need to overstretch yourself to enjoy a happy festive period. Here are 5 tips to cut the cost of Christmas.
1. Be disciplined
It may seem difficult to rein in your spending over the Christmas period, but a little discipline can go a long way.
Firstly, and most obviously, you should only spend what you can afford. That means setting a strict cash budget for food, entertainment and presents, and shopping around online and on the high street to ensure you’re finding the best deals available. Why pay retailers more than you need to? The cash is better in your bank than theirs.
If you have trouble managing your money, take out a cash amount before you leave and keep your cards at home, or even try a pre-paid credit card to ensure you can’t dip in to an overdraft, even if you’re tempted. That may sound drastic, but it’s certain to make you think seriously about every penny you spend.
Talking to friends and loved ones about setting a limit on what you spend on each other is another good way to keep costs down. As well as being cheaper, getting someone a gift that costs a fiver can often require a lot more thought than one that sets you back £50.
2. Be creative
Creating your own gifts like recipe books, photo collages or calendars can add a nice personalised touch and shouldn’t cost the earth. And if you have a talent, why not use it? Paint a canvas or even write a poem or song – the time invested will no doubt mean more to the recipient than money. If you don’t think your talents would be well received, you could just write an IOU for a favour – maybe a night of babysitting or a promise to finally fix that garden shed.
It doesn’t have to be limited to presents either – making your own mince pies, chocolates and tree decorations may not only save you money, but could also keep you away from a stressful supermarket dash on Christmas Eve.
3. Be savvy
If simple cut-backs aren’t enough, you could try to earn a little extra to cover your seasonal spending. Selling old, unwanted gifts on sites like eBay or Gumtree is an easy way of earning some Christmas spending money.
If you want to be even more sneaky, you could recycle old gifts by giving them to people who might appreciate them more – just be certain you don’t end up giving it back to the person who bought it in the first place!
You also needn’t feel guilty about doubling up on gifts. For example, buy a contract mobile phone for Dad on our site and you could also grab a free Xbox for junior (or, again, for Dad) – the definition of savvy shopping.
4. Be prepared
The bills don’t stop coming in at Christmas, so make sure you’ve set cash aside. They key to any good budget is making sure your key outgoings are included – that includes any bills for energy, insurance, council tax and so on. If you’re saving, then this should ideally come out at the start as well.
Once all of your necessary monthly payments are cleared – and only then – should you start thinking about gifts, otherwise you could end up far worse off when interest or charges are incurred for late payment.
5. Be a sensible borrower
Finally, if you do still need to borrow, make sure you’re doing so affordably and are getting the best deal. That means avoiding store cards with high APRs and looking at the most affordable lending options for your situation.
Depending on your credit profile, the right option could be anything from a 0% credit card (as long as you can repay in full by the end of the discount term), a suitable bank overdraft or a small low-interest loan from a credit union.
Think very carefully about how much you really need the money befor arranging any credit agreement, as falling into debt for short-term spending could lead to a more dangerous long term debt spiral.
We all know that feeling when a week before payday you're already out of cash, and often it's the little things that add up and sting us. With our cost calculator tool you can get an idea of how much you might be spending on bits and bobs.
