Debt at Christmas
It’s that time again, when shops have their shelves crammed with tempting food and ideas for Christmas. Saturday morning television is full of adverts for toys and games, and I feel I’m being pressured into spending more than we can afford because it Christmas. What can I do?
Undoubtedly for many, January not only brings the New Year, but the realisation that yet again we have overspent and will be paying for it for the rest of the year.
So how do we budget for Christmas without falling into debt?
-
· Write down on a piece of paper, how much you have coming in each week, and how much goes out. Don’t forget, Rent, Gas, Electricity, Food, etc and existing credit payments.
-
The money you have left over is what you have to budget with for Christmas.
-
Try setting a limit on how much you are going to spend on each person.
-
Don’t be tempted, unless necessary to buy toys from catalogues, they usually work out more expensive.
-
Look out for “interest free” deals if you decide to use credit and check the time limit on repayment. You may find that you cannot repay it in time and the interest is too high.
-
When using credit, check that the monthly instalments are within your budget, and the total charge, before signing on the dotted line.
-
Shop around, you may find it cheaper elsewhere.
-
Maybe try saving a little bit each week with your local Credit Union, that will help you for next year.
-
If you have more money going out, than you have coming in, either before or after Christmas, Remember some debts like rent or mortgage, council tax, gas and electricity are more important than others because of the consequences if you don’t pay.
-
Remember that Christmas is an expensive time of year for everyone. With some close friends and adults in the family you may be able to make a ‘no presents’ pact. Or agree to exchange only token gifts with a fixed limit on what you spend.
-
Try shopping with cash only - that way you can't spend more than your budget. If you can afford to pay for your goods outright, don't be persuaded to take out credit unless it really does work out cheaper.
-
Avoid store cards - most are poor value and some can charge whopping interest rates of around 30%
-
If you do need more money, don't just run up an overdraft without talking to your bank - this will be much more expensive than if you arrange it beforehand.
-
Remember that the hefty winter bills arrive in February when you’re most likely to be feeling the pinch after an extravagant festive season, so always allow for these in your budget. Make sure you keep up with all your priority bills over this period such as mortgage/rent, gas, electricity and council tax.
Finally, if you do run into debt problems, don't ignore them and hope they'll go away - they won't. SEEK ADVICE. The Citizens Advice Bureau can help you to prepare a budget and offer suggestions on how best to manage the situation. We can also offer free benefit checks to ensure you are receiving all the benefits you are entitled to and the correct amount for each benefit. Torfaen C.A.B. is the only specialist and generalist advice agency operating within Torfaen. We provide a quality assured advice and problem solving service for people from all sections of the community on a wide range of problems such as housing issues, benefit entitlements, debt, relationships, consumer issues, employment and so on. We offer an open door, appointment and telephone service and represent clients at Social Security and Employment Tribunals and at the County Court for mortgage/rent re-possessions. We also help shape policies and improve services through our independent feedback based on our work with local people.