Christmas is a time for giving, but you don’t want to start the new year with a pile of bills you can’t afford to pay. 

You may feel under pressure to spend more than you can afford because it’s Christmas, follow these simple tips to avoid a post Christmas debt hangover.

Top Tips to avoid a Christmas debt Hangover 

Plan early for Christmas

make a list of all the things you will need to buy.  Be realistic about the total amount you will be able to spend.  Work out how much you are going to spend on each person, and on extra food and drink items.  Talk to your friends and family to manage their expectations about how much you will be able to spend on their gifts.

Manage your regular bills

make sure you don’t leave yourself short of money to pay your essential bills.  There may be severe consequences if you don’t pay them.  Just because it’s Christmas doesn’t mean your bills don’t need to be paid on time.

Don’t overstretch yourself

don’t be persuaded to take out extended credit agreements in order to pay for gifts.  Check the APR – you may be paying much more than you intended, and it may take years to pay off the debt.

Shop around for the best deals

make a list of the items you want to buy and start shopping early.  Compare prices at several different shops and online before making your purchase to make sure you get the cheapest price.  Take advantage of 3 for 2 offers and other discounts the retailers may put on – but don’t be tempted to impulse buy gifts, stick to your list.

Start buying food and gifts early and store them away 

look out for bargains all year round and create a “Christmas food store” of non perishable items.  In this way you can spread out the cost of Christmas over several months rather than paying for it all once.

Don’t fall for offers that are too good to be true

if something is too cheap there’s usually a reason - the goods may be fake or unsafe.  If someone is offering to lend you large amounts of money – there may be hidden charges – don’t borrow from unauthorized lenders.

Don’t max out your credit card

if you use your credit card to finance your Christmas purchases check out how much interest you will be charged if you don’t pay it off in full when the bill comes in January.  There may be cheaper ways of borrowing money for example from your local Credit Union.  If you pay only the minimum amount off your credit card bill, the interest charges will soon mount up and your debt may become unmanageable.

Start planning for next Christmas in January

look at what you did well and what didn’t go so well, learn from your mistakes and plan how you will do things differently.  Start saving a small amount each week to help towards paying for next Christmas.  You could even buy some things for next Christmas in the January sales at a fraction of the price!

Planning, budgeting and organisation are the key to avoid getting into debt at Christmas.  If your spending gets out of control, you may get into a debt pattern that becomes unmanageable and could take years to clear.