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How to avoid personal debt at Christmas

Christmas comes but once a year, but many people spend more on gifts and treats in a few short weeks in December than in all of the rest of the year put together. Spending money you don’t have to fund the festive season is not a wise choice when it comes to managing personal spending although the temptation to put it all on a credit card can be very strong. With a little planning, however, it is possible to avoid adding to personal debt at Christmas, but it does involve starting early.

Put cash presents in a savings account

If you are lucky enough to get cash at Christmas it is tempting to go out and buy yourself something you might not otherwise be able to afford. It is a much better plan to put the money in a savings account, to offset the costs of next Christmas. The only time this is not a good plan is if you have expensive debts which need addressing – in this case, use any influx of cash to pay some off. It isn’t very festive, but it will feel better to owe less and peace of mind is priceless.

Look round the sales

Sales are excellent as long as you only buy at lower prices what you would have bought at the RRP. Otherwise, it isn’t a saving. Buy presents for next Christmas and stow them somewhere safe. This can save a lot but with the notion that every penny counts well to the fore, even buying wrapping paper and cards at reduced prices will help. Many stores start their sales before Christmas, so you can save for this year by shopping at the last minute. But make sure that you don’t fall victim to last minute panic buying – this can be pricey.

Set a budget and stick to it

Going out with a shopping list but no budget is fatal and can mean you spend more than you can afford. Don’t just plan to buy a jumper – plan to buy a jumper for less than a certain price. This may mean taking longer, but you won’t overspend and end up with a load of debt. If you haven’t much money at Christmas, don’t hide it from your family and friends. They won’t think any less of you if you give them a smaller present – it really is the thought that counts.

Don’t be tempted into short term loans

Payday loans and cheque cashing services are very tempting at Christmas, but they really should be avoided. Although in certain circumstances they can be a one-time-only quick fix, they should certainly not even be considered for expenditure like Christmas presents.

If you need help

If you find yourself in financial difficulty, it is simple to put yourself back on track with a call to Dissolve Debt. We have been in business helping UK residents get their finances on a healthy footing for ten years now and with our simple debt calculator on the website, you can see within seconds how we can help you start 2014 in good financial health.

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