Not everyone has the means to splash the cash for Christmas. With the effects of the lockdown measures in the UK taking their toll on many families – over 600,000 more families had to turn to food banks this year than in 2020. It makes sense that the run-up to Christmas will place an extra squeeze on already strained finances.
Planning for Christmas is something everyone knows they should be doing; however, if money is tight, this isn’t always possible. The average spend per person for Christmas for 2020 was thought to be around the £500 mark. Of course, this can vary depending on the size of your family. And the type of gifts and traditions you have to celebrate this time of year.
It might be too late to start saving vast sums of money now so close to the holidays. But if you are feeling the pinch, this post looks at ways to reduce your outgoings and help you find some extra money for Christmas. Without going into debt.
What can you realistically afford
This is as good a place to start as any. Make a list of everyone you need to buy gifts for. And how much money you can afford to spend per person. Trim the fat from your list by removing non-essential people such as extended relatives and concentrate on your immediate family.
Don’t forget to factor in things like wrapping paper, cards, sellotape, gift tags, etc. These items all add up, especially if you have many people to buy for.
To begin, prepare a list of everyone for whom you intend to purchase gifts. Then decide the maximum amount you are willing to spend on each person. Also include any travel you may anticipate, as well as any unexpected bills, such as food for a holiday dinner. Between now and November, you’ll need to be putting money aside for the total amount you’ve budgeted for.
If you can start now, this gives you a couple of months to put some money down in a savings account. November is when the bargains typically get pushed out. If you haven’t already snatched up the products you need to buy, you may be able to get some pretty amazing deals.
If you can reduce your spending, it is ideal; but, increasing your spending is a big no-no because it will completely devastate your budget.
Take advantage of discounts
Identify the people you need to buy gifts for. If you come across items at a reasonable price, grab them and stash them away in a Christmas cupboard.
In addition, if you find anything at a great deal this year, don’t bank on it being available in December due to supply chain concerns, which could result in shortages on store shelves. According to the British Retail Consortium, well-publicized supply concerns surrounding stock of various commodities, including toys, could result in less availability and higher pricing.
Look to places such as Boots for their famous 3 for 2 offers or star buy deals. Find discounts in bargain retailers on dupes of expensive high-end products. Take advantage of any savings you have on loyalty cards to get more significant discounts or to swap for money off (think the Tesco Clubcard, Boots Advantage Card or the Superdrug Health and Beauty Card).
Not all gifts cost money
If you are pushed for money to afford gifts, look at ways you can get creative and craft your presents or offer alternatives such as offering to babysit for your brother or sister so they can have a childfree day out or making breakfast in bed for your partner to give them a much-needed lie-in and so on. Sometimes, these thoughtful gifts mean more than spending money to buy stuff they don’t necessarily need.
Cut back on bills
Cutting back on bills is something that is heralded as the “answer” every time people need to save money. But there is a reason why it is the top way to make extra money, especially at Christmas. Many people fail to check exactly what they are paying for through their bank and, as such, are losing money by not cancelling old direct debits or not switching suppliers when their contracts run out.
Always look for better deals and shop around to compare mobile phone contracts, and lower your bill, car insurance, home insurance, utilities and more.
Shop pre-loved
Buying preloved items, especially for younger children, is a great way to save some money. With the cost of living rising year on year, spending large sums of money on items that might be discarded quickly isn’t always feasible. This can often be the case for children especially.
Look online on sites such as eBay, Amazon Warehouse and Vinted to buy preloved items at a fraction of the cost. This will help you to be able to afford things you might not have been able to purchase brand new. Of course, this isn’t for everyone. But if you are comfortable gifting used items, and you know the recipient won’t mind, this is a great way to reduce how much you spend.
Use 0% interest cards
If you are looking at using credit to help you afford the cost of Christmas, look for 0% interest deals. Typically available for those with better credit scores, this is a better option than taking out a higher interest credit card to purchase presents and supplies for Christmas and plunging yourself into debt. Pay off the balance before the end of your interest-free period. This avoids paying extra and effectively spread the cost to make it more manageable.
Use cashback sites
If you are doing the majority of your shopping online, then shop via cashback sites. This not only unlocks some great discounts at retailers but allow you to build up a little nest egg to cash out at a later date.
All you need to do is sign up at the site of your choice, be it Quidco, Top Cashback or others and make sure you make all qualifying purchases via the site for your cashback and any discounts to be registered. You can allow the money to accumulate, or you can withdraw as soon as you meet the minimum threshold. If you are going to be spending online anyway, you have nothing to lose shopping this way.
Sign up to emails
Not everyone likes their inbox to be inundated with pointless emails. However, around this time of year, companies ramp up their marketing efforts. This means from here on out, you can be privy to some great deals and bargains by simply entering your email address.
You can always unsubscribe at any time. But if you are looking for ways to buy more for less, then loyalty offers for email subscribers are a great place to start. Plus, you can be alerted to any price drops or offers, too, handy if you have your eye on something.
Boxing Day sales
Boxing Day is after Christmas, but if you know you aren’t going to be seeing certain family members before or on Christmas, then why rush to purchase something in advance? Take advantage of the massive sales that typically start online on Christmas Eve to buy those last few bits and wrap them when they arrive. This won’t work for everyone. But if you know you have time post-Christmas, put off buying the gift and get something on offer in the sales.
Think ahead
Ultimately, the best way to prepare for Christmas is to plan ahead. Even as far as Christmas before. Assess your monthly outgoings and see where you can make changes to save money to help you budget for Christmas next year.
You can put small amounts away each month into a savings account or shop with a well-known high street voucher saving company with whom you can place an order for vouchers or gift cards and pay them off throughout the year. It may seem like you are struggling at first, but getting in the habit of putting money away as early as possible can help you budget more effectively and avoid the crazy rush to find the money to pay for Christmas as it rolls around each year.
Conclusion
In the end, being prepared is the best way to budget for Christmas. With the pressures on people’s incomes increasing, finding ways you can stretch your money that little bit further will help you to not only lower the cost but get creative with the gifts you buy and how you celebrate this time of the year.
Try to avoid going into debt. If you do rely on credit, make sure you pay it off quickly to prevent it hanging over your head into the new year. Create and stick to a realistic budget. Be strict with yourself when it comes to splashing the cash or not splashing it as the case may be!
