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10 great tips to help you avoid Christmas debt

Whether you’re watching your favourite TV show, browsing online or catching up with friends on social media, it is virtually impossible to escape the plethora of festive adverts aimed towards helping in the pursuit of the perfect Christmas.

From gorgeous gifts and must-have gadgets to festive feasts and pretty partywear, your festive pound is big business for any company – they’ll even flog you a new kitchen sink if they can guarantee delivery before the big day!

In a world driven by consumerism, it’s all too easy to forget the real spirit of season and get caught up in the pursuit of the idealistic Christmas advertisers sell to us – and to achieve it you need money. Lots of it!

For many people this means accumulating debt that they’ll struggle to repay. In March 2013 the Money Charity published findings by The Co-operative Bank which showed that most people in the UK will not begin to pay off their Christmas debts until March the following year, while 22% will still be trying to clear Christmas debt from the previous year.

What you can do to reduce the cost of Christmas and avoid debt

The most effective thing you can do to avoid Christmas debt is to plan early – but if you’re looking for some last minute money saving ideas, here are our top 10 festive finance tips…

ListGet organised!

The best way to keep track of your spending is to plan. So grab a pen and a piece of paper and make a list. Once you know exactly what you need to buy – whether that’s gifts or food and drink – you’ll be able to create a budget that you can stick to. Make sure you also include additional little extras like Christmas parties or days out with the family, otherwise any un-planned spending could wreak havoc on your wallet. Seeing how much money you physically need to finance the festive period will help you keep track of your spending and hopefully avoid impulse purchases.

UtilitiesDon’t forget your everyday bills

It’s important that you don’t forgo paying your bills to help make Christmas more affordable. Missing a bill payment or falling behind on your rent or mortgage will have a knock on effect on your finances well into the New Year. When you create your festive budget, make sure that you factor in ALL of your outgoings.

Credit cardAvoid taking out additional credit

If you’re already struggling financially, using additional credit will just add to your financial woes. Using a payday loan or credit card may seem like a good idea in the short term, but if you cannot make repayments, your debts will only spiral further out of control. Some people may find that a friend or relative could help them out instead of relying on high rate lending. Providing you pre-arrange a realistic and affordable repayment structure – and stick to it – this could be a practical solution.

QuestionAlways question your purchases

Before you buy anything, always question whether you really need it. It’s so easy to get caught up in the things that don’t really matter. While you may want new decorations, a dining table or sofa, or a new outfit for the office party, your Christmas probably won’t be affected in any way if you make do with what you already have. While luxuries may be nice, they’re certainly not worth stretching your finances for.

Santa with scroll paperKeep your gift list simple and small

Keeping your gift list small is an excellent way to avoid overspending and stick to a budget. Many people feel pressurised into the obligation of buying a neighbour, friend or relative a gift because they often receive a present from them. Many people would most probably welcome the opportunity to save money themselves, so why not approach them and tell them that you won’t be buying gifts this year and instead agree to meet up and have a coffee in the New Year?

Christmas giftsGet creative

As the old saying goes, ‘it’s the thought that counts’ – so get creative with your gifts! A well thought-out personal gift could mean much more than an expensive present. For example, you could create a picture montage of treasured snaps in a frame or record a home video to deliver a special message. Stuck for an idea? The internet is brimming with lots of fun and creative ideas. Log on to Pinterest and you’ll have a scrapbook of great ideas in no time!

online bankingShop around

Once you have an idea for a gift – shop around for the best deal. Whether it’s on the high street or online, you’ll find lots of competitive deals. There are also lots of ‘for sale or swap’ pages on social media and auction sites where you could find great deals. Make sure you take advantage of voucher sites and save even more money! Take a look at sites like Voucher Codes and Voucher Cloud to see what’s available.

Brown paper package tied up with stringsRecycle

It’s time to delve into that old sayings pot again… have you heard the one that goes ‘one man’s rubbish is another man’s treasure’? Shopping on auction sites or charity shops is a great way to find a bargain, but have you ever considered that this could be a way for you to earn a little Christmas cash? Set up an eBay account, have a clear out of any items that are in good condition but that you no longer want and get selling!

Retailers Christmas 2013 Baines and ErnstWait for the sales

Another option would be to wait until the sales. You could create your very own gift voucher detailing the gift and when you can go shopping for it. Become a savvy shopper and you’ll see how much further your money can go.

Christmas Day Calendar Icon. 25 December. Vector IllustrationPrepare for next Christmas in the New Year

The best thing you can do to make next Christmas as affordable as possible is to prepare for next Christmas in January. Saving as little as £1 a day will give you £365. Save £10 a week and you’ll have £520 in the pot. There are also some Christmas saving schemes that you could look into. Get prepared and you’ll be able to enjoy the festive season with less stress.

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