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While the festive season promises joy and celebration, it often accompanies financial strain, especially for those facing challenges. In this guide, My Debt Plan delve into festive period debt, shedding light on its nature, causes, and effective strategies to steer clear of the festive debt trap.
Amidst the merriment of the holidays, many find themselves grappling with Christmas debt, stemming from extravagant spending on gifts, gatherings, and seasonal indulgences. This financial burden, colloquially known as Christmas debt, emerges from overspending during the festive season, leading to subsequent financial woes.
Christmas debt can manifest directly through extravagant holiday expenses like lavish gifts and social events. Indirectly, it arises from the strain on finances, making individuals vulnerable to unexpected expenses or resorting to short-term credit options like payday loans to cover holiday costs.
While tempting, resorting to credit, such as Christmas loans, to navigate holiday expenses can exacerbate financial woes. Christmas loans often come with stringent repayment terms and high-interest rates, posing a significant risk if repayment falters, leading to a cycle of debt accumulation.
To circumvent the pitfalls of festive overspending, adopting prudent financial practices is paramount:
To bolster your holiday finances without resorting to debt, consider exploring supplemental income streams like selling unused items or undertaking seasonal employment opportunities. These endeavors can provide a welcome financial boost, enabling guilt-free holiday spending while avoiding the pitfalls of festive debt accumulation.
While the allure of the festive season is undeniable, navigating holiday finances requires prudence and foresight. By adopting sound financial practices and avoiding the lure of unsustainable credit options, individuals can usher in the holidays with joy and celebration, free from the burden of festive debt.
Dealing with Festive period debt? Our team of is here to help. Give us a call on 0161 660 7255 or send a message here.
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Lucy Novo Deakin is a licensed insolvency practitioner in the UK by the Insolvency Practitioners Association (IPA).
My Debt Plan Ltd provides insolvency solutions to individuals, specialising in IVA’s. All advice given is provided in reasonable contemplation of an insolvency appointment. Where you are not suitable for an IVA, we may refer you to one of our trusted partners who specialise on alternative solutions, and as such we will receive payment for the introduction if you enter into a debt solution with one of our partner companies.
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To find out more about managing your money and getting free advice, visit Money Helper, an independent service set up to help people manage their money.
*Our advice on your options is always free. We will always notify you if a solution you choose has any cost.
**Of 2,381 IVA cases approved between January-December 2023, the average expected write off assuming successful completion is 74%.
A debt write off amount between 25% and 75% is realistic, however, the debt write off amount will differ for each customer upon their individual financial circumstances and is subject to approval of their creditors. Any remaining qualifying unsecured debt in your IVA will be written off, however some unsecured debts will be excluded, such as court fines, child maintenance and student loans, therefore you will need to continue paying these both during and after the IVA.
