It’s easy to overspend, especially at Christmas. Here are some tips to avoid overspending or getting into debt over Christmas.
Firstly, ask yourself. Do you need to give a gift to everyone you're planning to? Watch this video from Money Saving Expert, Martin Lewis who talks about why it's time to ban unnecessary Christmas presents.
Stick to a plan
Work out how much you’re going to spend on each person and stick to it. Don’t be tempted by seemingly ‘great deals’
Avoid running up your overdraft
If you need more money than what you have in your account, talk to your bank before you run up an overdraft. If you don’t, they will charge you for it. There are other options which may be cheaper, like taking out a small loan from a credit union.
Pay upfront where you can
Pay for your gifts straight away if you can. Don’t take out credit agreements unless they really do work out cheaper. You might think you’re saving money at the time but you can end up paying more in the long run.
Read the small print
If you’re taking out credit to pay for gifts, make sure you check for hidden costs. Work out the total amount you’d need to pay back and make sure you can afford the monthly repayments. Always do this before you sign anything. Interest-free credit can be tempting, but if you don’t pay on time, or miss a payment, you could end up paying a lot more.
Compare credit deals
If you’re going to use a credit card, shop around and compare terms. Some cards charge high-interest rates but give you interest-free periods or discounts. Make sure you find the right card for you. Find out more information on moneysavingexpert.com.
Stay on top of payments
If you do borrow money, make sure you budget for all the costs. Put the payment dates in your diary and set a reminder on your phone, so you can’t miss them. Pay on time, even if it’s only the minimum amount, or you’ll end up having to pay much more later on.