Top Tips for Recovering From Christmas Debt

Christmas. Full of festive cheer, food and celebrations. It’s an exciting time of year and one to be spend with our loved ones. A happy series of events at the time with a stressful aftershock for most of us. Christmas spending is an issue for a huge proportion of us. We’ve put together some of our best advice for recovering from the annual Christmas spending hangover.

7.9 million of British people fall behind with their finances in January due to the effects of Christmas spending. If you remember wondering just how you spend THAT much last year, this year you need to be considering steps you can take to gain control over your finances and how is best to recover from your festive debt.


Asses your entire financial situation. Examine your budget and your goals and make sure that they correlate. Does your current budget allow you to make the savings or credit card payments that you plan for. Sit down and make a list of all of your debts, when you need to make payments (and how much they need to be), the interest rates on all of your accounts and how long you’re going to give yourself to pay them off. Take into consideration all of your financial goals/requirements and make sure you can realistically fulfil them all.


Identify a payment strategy that’s going to work best for you. A common tip is to pay off your credit cards that have the highest interest rates first. We understand that this can feel quite daunting so paying off smaller balances to show yourself that it’s possible is also a good tip. If you can, we recommend always paying more than the minimum payment. However, even if you do pay off the minimum, make sure it’s always on time.


Stop impulse spending and spending without purpose. Have a financial detox and only spend on essentials. Do this until you’ve caught up on any debt to avoid sinking further into it. Look for coupons for your weekly shops and use comparison sites when online.

Make coffee at work or take it with you in a travel mug, prepare lunch instead of picking up convenience food. Do some DIY pampering instead of heading to the salon and you’ll notice some huge savings.

Take time to review your monthly outgoings. Look at your TV packages and phone bills to make sure you’re not paying for things you aren’t using. When going out for the day always check for discount codes for admission or deals at the time. There’s always restaurant discounts, family attraction offers lurking on the web.


Start consciously saving for next Christmas. Putting a small amount away each month will give you a lump sum to either put towards or completely pay for your festive spending next year. The more that you can pay for with cash means less credit to pay off following the Christmas season. Putting away £50 a month would give you £500 to spend by the time Christmas comes around. That’s lots of presents, celebrations and Christmas food!


Make a list of everybody that you need to buy gifts for and potential gift ideas for each of them. Have an idea of what you’re buying way ahead of Christmas and keep your eye out for offers and promotions throughout the year. By doing this you’re avoiding hugely marked up prices that we see every year near Christmas. There’s lots of information on the internet on when’s best to buy particular items throughout the course of the year.


Starting Christmas shopping early is something that some of us promise ourselves we’ll do every year and never do. It’s one of our biggest pieces of advice for avoiding huge debts following Christmas. By doing it you’re spreading the cost of gifts across the whole year rather than giving yourself the challenge of paying for them with 1 or 2 paydays. Your credit balances will stay low and stay manageable whilst still building your credit rating.


Think about how you are going to pay big items off before you buy them. Just because you’ve had your eye on something for months and months, don’t buy it with no plans to pay it off. Can you make a few adjustments and sacrifice a few expenses to make room for an extra outgoing? If not, re-evaluate your budget for gits this year.


Take a look at your credit cards and make sure you’re being sensible with the ones you use and what you use them for. Do you need to be using cards that carry annual fees? Look for cards which offer rewards, then use the rewards as a contribution towards your Christmas expenses.


Have a look at your credit score so you have an idea of where you stand and how the festive season has impacted upon it. Once you’ve had a chance to reduce your debts then re-assess and see where you stand once it’s gone. This will give you motivation to maintain a healthy credit score and stay clear of debts next Christmas.


For more information on healthy finances, get in touch with the team!

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