Now you have a solid plan to reduce your Christmas Debt, its time to think about ways to avoid the same situation. In other words, how can you have a debt-free Christmas in 2021?
1. Plan early
Lots of people have the mindset that it is wrong to think about Christmas early. They think that they ‘can’t start early’ or can’t think about it until a certain point in time.
There is no shame in having a plan. In the same way that you plan a holiday, plan what you are going to buy at the supermarket or plan what you need to buy for a baby you also need to plan for Christmas.
I like to follow the Team TOMM Organised Christmas which starts you off in September. This is a comprehensive list of what you need to do to get organised by December 1st. You can get a flavour for what it entails here. However, this year I will be making my Christmas Financial Plan in July. I will be thinking about my budget and how far it needs to stretch.
2. Decide who you need to buy for earlier
Failing to plan is planning to fail. This year I am going to have a list of who I need to buy for and the budget for each person decided in the Summer. That way I can take advantage of summer sales and get more for my money. I will keep track of what has been bought by using one of the free Apps like Giftster.com. This will help me spread the cost of Christmas even further, and by taking bite-sized steps each month I am reducing the impact of it on my cash flow in November and December. Planning like this is key for a debt-free Christmas.
3. Take baby steps throughout the year
I know that I like to shop at a luxury supermarket at Christmas. This year I am going to start buying gift cards (which can be used online or instore) for that supermarket. Nothing huge, but each month I am going to buy a gift card for £10. That way, when it comes to December I will have £120 securely in the bank to pay for the food shopping. There is a reason why I am doing this rather than just putting it into a separate bank account – it secures me that money specifically for the Christmas dinner. I also know that if I didn’t need to spend it on food, I can spend it on their non food items in the after Christmas sales.
It doesn’t have to be just for supermarkets you could do this, any big retailer which you are pretty certain you are going to use at Christmas could be saved for using this method.
If you prefer cold hard cash you could save that instead of vouchers. To be fully effective make sure you use a separate bank account (preferably with a different bank to your everyday account) to reduce temptation. Small steps like these will have you well on your way for a debt-free Christmas.
4. Sign up for supermarket loyalty savers
I posted about this back in October but various supermarkets have bonus saver schemes where you can save a little each week ready for Christmas.
It’s important to do your research because they are all different. However, this is the round up of the major supermarket offerings as at January 2020:
Tesco’s Christmas saver plan gives you the option of keeping your clubcard vouchers until your November statement, therefore they arrive in a nice big bundle ready for Christmas. In addition you can top up the vouchers with your own cash and earn extra bonus vouchers.
The Asda Christmas saver plan works slightly differently in that you need to a cash to a ‘card’. If you have a certain amount on the card by November, Asda generally top it up by 5%.
5. Declutter earlier
This year I managed a decent pre Christmas sell off of our unwanted items. This freed up space in the house but also gave me some much needed extra cash. Trouble is I started too late! I was exhausted from having so much stuff to get rid of in a small space of time.
This year I am going to start the decluttering process earlier and get things listed as soon as they are outgrown.
This article is the first in our series on How to Pay for Christmas in 2021.
If you are struggling with debt in the UK you can contact Citizens Advice for free confidential advice.