HOW TO ENJOY A DEBT-FREE CHRISTMAS
TIME is running out! You have less than three weeks to get everything ready for Christmas, so do not put it off any longer.
It’s the most wonderful time of the year, as the song goes, but also the most expensive with the average household expecting to spend £719 on seasonal activities, according to GoCompare.com.
This is made up of £365 on gifts for family and friends, £172 on food and drink, £106 on socialising, and £76 on a tree and decorations, tickets to the panto and other festive fun.
CHRISTMAS CARDS
More than half of us will foot the bill from income, with almost three out of 10 using money set aside during the year,. However one in 10 will rely on a credit card to cover the cost.
There is still time for you to order a competitive card for shopping. Top deals include Sainsbury’s Dual Offer which gives you interest-free credit on both balance transfers and purchases for an introductory period lasting 29 months.
Georgie Frost, consumer advocate at GoCompare Money, said a credit card can be a good way to spread the cost provided you make your minimum monthly repayments and clear the debt during the initial offer period: “Be realistic about how much you can borrow to avoid a financial hangover.”
The added benefit of a credit card is you get consumer protection for purchases between £100 and £30,000, in case of faulty goods or a dispute.
DON’T GO CRACKERS
Sarah Coles, personal finance analyst at Hargreaves Lansdown, said draw up a budget and do your best to stick with it, although research shows more than half of us blow ours with a whole industry devoted to making us overspend. “One way to avoid the temptation is to wait 24 hours before making a major buy to be sure it is something you really need,” she said.
“Ask if some Christmas traditions are still worth the price: Do you really need festive liqueurs or fancy crackers? Don’t assume everyone wants old traditions, ask them.”
If your budget is stretched, talk to friends or family about presents in advance: “You can just buy for the children, or run a secret Santa and buy for one person in each group.”
If seeing people after Christmas you can always buy their presents in the January sales or consider a cheeky regift or two, Coles added.
RAISE CASH
Always compare prices online and use websites such as eBay, Gumtree or Shpock.com to buy second-hand goods or raise a little cash by selling your old electronics, clothing, books, DVDs, toys or furniture. This could also be a good time to use up all your points, rewards and vouchers.
Debs Vickers, personal finance expert at MoneyGuru.com, said home baking and hand-crafted cards, presents and hampers can be cheaper and offer a personal touch: “Take inspiration from sites such as Pinterest and Instagram.”
Moneymagpie.com founder and personal finance expert Jasmine Birtles said: “You can clean up a nice vase, decorate it with some ribbon and tinsel and give to someone with lovely seasonal flowers such as a poinsettia.”
START SAVING
Once Christmas is paid off you might want to start saving for next year.
Rachel Springall, finance expert at MoneyFacts.co.uk, said a free mobile app like Money Dashboard can identify spending cutbacks, which you can then put in a regular savings account every month.
The best regular savings accounts are branch-based so check your high street otherwise Principality Building Society offers 2 per cent online on a minimum £20 a month.
Springall added: “You could earn up to 5 per cent on a fixed regular saver if you are prepared to switch your current account to First Direct, HSBC, M&S Bank or Nationwide Building Society.”