Dec 19

Overcoming the Christmas financial lull

Reading Time: 3 mins

We all love to spoil our friends and family over the holiday season, but when the New Year comes around we can be left in a bit of a panic. If you’re trying to recover from the festive hit to your wallet, then Jane Clack, money adviser at PayPlan, one of the UK’s most trusted free debt advice companies, has these tips for getting back on track with your finances.


New Year’s resolution

Rather than joining a gym to sweat off the Christmas turkey, make your New Year’s resolution a commitment to clear any outstanding debts or bring in a little extra cash to go towards your savings. Looking back through your monthly accounts can be a great way to start. Review your bills to see if you can make any easy savings; why not swap to a SIM-only phone contract, or find a cheaper energy provider? Find out exactly where you are spending too much, what you can cut out, and research what alternatives are available using comparison websites.

If you want to bring in extra income, consider taking an online course or evening class to learn a new skill that can help you work towards a promotion or create a side business. Creative people can turn their hobbies into an online enterprise, selling their wares on websites such as Etsy and Facebook or at local craft fairs. Depending on your work, you could ask your managers whether you could pick up any extra shifts – if not, there are a number of online surveys or market research opportunities that offer payment for your help.


Christmas starts in January

According to the Bank of England, the average household spends a staggering £500 during the Christmas holiday period – on top of the typical £2,000 monthly spend. If you struggled with the cost of Christmas, it’s never too early to plan for next year. Start by putting a little away each month (or week) into a dedicated Christmas fund – even if it’s just £5 or £10. As simple as it may sound, signing up to high street and supermarket reward cards are another great way to save for next year’s festivities.

If you can’t resist a lunchtime meal deal or coffee on the way to work, it’s worth thinking about how the costs stack up. According to Vouchercard, those who choose to buy a meal every day while at work spend an average of £1,840 a year. Instead, opt for homemade sandwiches and a flask of hot drink. When you do treat yourself to a coffee, remember savings are available in some cafés by taking a reusable cup (you’ll also be doing your bit for the environment at the same time).


Set challenges

Working out a practical budget for the year can be a real help to ease the panic caused by a festive financial hangover. Budgeting apps are available, but it’s easy to write down the essential monthly expenditure, such as rent or mortgage payments, food and energy bills and any debt repayments, and then work out the average amount left over each week to save or spend on yourself. Once you have got this average budget, set yourself the challenge of trying to reduce it as much as possible so you have even more to put away on savings.

Get your family and friends involved (especially if they’re in the same situation) and see if you can come up with money saving plans. Getting together for nights in with a relaxed diner instead of going out to a restaurant can obviously save you a lot of money, especially if you alternate who hosts it.


Limit credit card use

It’s always easy to fall back on your credit card over Christmas, which inevitably means a big bill in January. Saving up throughout the year, either with a dedicated Christmas fund or just an emergency savings account, can help you stay away from this danger, as well as any overdraft or late repayment fees.

If you do have a credit card debt to pay, make sure that you at least stick to minimum payments over the expensive festive period to avoid any additional charges. Once you have recovered from the costs of Christmas, make sure that you resume paying off as much of your debt as you can to achieve a debt-free future.


Make some room

You may have received a lot of gifts that you just don’t have room for, so why not start the spring-clean early? Start selling anything you no longer need. Don’t be afraid to sell any unwanted gifts either – it’s better that they find a new home rather than gathering dust in your cupboards. You can also re-gift them to others, as long as you don’t give it back to the person who gave it to you!

Children grow out of clothes and tire of toys quickly, so give them new life by selling them on to other families in a car boot sale, or online as bundles on Gumtree and eBay.

For more information about PayPlan, visit or call 0800 280 2816.

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