Stay in control of your Christmas spending and avoid a painful New Year debt hangover with our top tips
Set financial goals
No matter whether you’re someone who loves to make New Year’s resolutions, or you prefer to live in the moment, having financial goals in place for the year ahead can help you rein in your December spending. If you know what you want to achieve, you might find it easier to turn down that expensive night out or wear something from your wardrobe rather than splashing out on a new party outfit.
Your goals could be big or small. Perhaps you’re aiming to clear your existing debt or saving for a big trip abroad? Or maybe you just want to cut down on your weekly takeaways? Breaking down your money goals into targets that you can set throughout the year could help make them feel more achievable and give you an extra boost of motivation to spend sensibly ahead of the New Year.
Implement a workable budget
One of the biggest mistakes we make when trying to avoid a New Year debt hangover is putting a strict budget in place. December is a month filled with temptations: limited-edition food and drink, shops filled with gifts, and Christmas gatherings with friends, family, and work colleagues. Turning down everything that the festive season has to offer to save money will only make you miserable. Instead, plan a realistic Christmas budget – and stick to it. You can still look for areas where you can cut back, but also leave room to indulge now and then. Take time out at regular intervals to check your spending against your budget so you can stay on track.
Talk about money
While there’s a lot to enjoy in the festive season, there can also be a lot of pressure to spend in December. Friends and family might have high expectations for gifts, your work could organise after work drinks and a Secret Santa, and your friends might want to meet up for a meal – the costs can easily add up!
Being open about your financial situation and setting expectations can help. Whether you’re struggling with debt or hoping to make some savings, talking about how much you’re able to spend could prevent awkward conversations later – and you might find out they are in the same boat! Consider setting a group spending limit for Christmas gifts or agreeing to only pay for you own orders rather than splitting the bill at meals out.
Be mindful of buy now, pay later
Buy now, pay later options are becoming more readily available and can be attractive, especially at Christmas. When you’re already overspending in December, the thought of pushing some payments into January – or even later – can look like a great solution. Unfortunately, they can also lead to a painful New Year debt hangover. Be mindful if you’re considering using any credit options, especially if you think you might miss future payments or are already finding it tough to manage your debts. You could end up increasing your overall debt or paying more in interest. Buy now, pay later could also impact your credit score if you fail to make the repayments on time.
Shop around
There’s no shame in shopping around to find the best deal. Do your research online, compare the special offers available, and visit different stores to find the most cost-effective options. The more savvy you can be with the items you choose, the less likely you are to wake up with a New Year debt hangover. Preparation is key: the more time you have to carefully consider your purchases, the better. And don’t be afraid to get a head start on next year’s gifts if you come across a great bargain.
Ask for help
If you’re struggling with debt or worrying what your finances might look like in the New Year, don’t suffer in silence. Seeking advice from an expert debt advisor this year could help you kick-start January with a plan in place to tackle your debts once and for all. An impartial debt professional can listen to your concerns in a confidential chat and talk you through all the options available.
If you’re looking for debt advice to start your New Year on the right foot, our friendly team of experts at My Debt Plan is here to help.
