With less than a month to go until you’re tucking into that Christmas Pudding and singing drunken renditions of Slade, you’re probably getting to the stage where you’re just ticking the final names of your gift list. But have the financial implications started to sink in yet?
Can you really afford all those items on your child’s wish list, or the huge grocery bill to feed your entire family?
As much as Christmas is, and should be one of the most enjoyable times of the year, it can be an anxious and stressful time for many – particularly if you’ve borrowed money to pay for all the festivities. Whilst it may be easy to ignore this over the festive period, the downward spiral may begin once the bills start to roll in, in January. The post-Christmas comedown can be even more depressing if you are left with mounting debts due to excessive spending.
So how can you make your Christmas stress-free?
One of the easiest ways of paying for Christmas is with savings that you have put aside throughout the year. Whilst you may have missed the boat this time around, perhaps it could be something you could plan for the future? How much have you spent on Christmas this year? Will it be similar next year? Work out how much you’d need to put aside every month to reach your target and next Christmas may be a little bit easier on the wallet – and the stress-levels.
Of course if you are worrying about how you are going to pay for Christmas this year then you may need to look into borrowing options. There are different ways of borrowing so do your homework to find out the best options for you.
A credit card is probably the most common form of borrowing over the Christmas period as it’s one of the most accessible forms of credit. The interest rates on credit cards can vary, but where most people get caught out, is by not paying off the balance each month or not meeting the minimum payment. If you don’t clear your balance in full each month, you’ll continue to accrue interest on the debt, making it more difficult to pay off.
If you have to use a credit card to pay for your purchases then choose a card wisely. If you have a good credit rating, you may be eligible for a 0% interest purchase credit card. Look for the card that offers the longest interest-free period as during this time you won’t incur any interest on your spending – making it easier to pay off, even if you can’t afford the full balance in the first few months. Just make sure you manage to meet the minimum payment, as missing it could force the lender to change the terms of your deal.
Alternatively, you may wish to consider a cashback credit card where a percentage of the amount spent will be paid back to you.
What you shouldn’t do
Short-term or so-called Payday loans can seem like an attractive option to borrowers who are in need of a quick cash boost as they are pretty easy to get, with lenders not asking to many questions about your past credit record. But unfortunately, this means that vulnerable borrowers may be tempted in without checking the small print. Some payday loans have extortionate interest rates which put borrowers in a very dangerous trap of having debt that’s almost impossible to pay off.
The above post is intended to be informative but does not constitute advice – financial, legal or otherwise. Any opinions given are the author’s own and do not necessarily reflect the views of SO Media.
THINK CAREFULLY BEFORE SECURING OTHER DEBTS AGAINST YOUR HOME. YOUR HOME MAY BE REPOSSESSED IF YOU DO NOT KEEP UP REPAYMENTS ON YOUR MORTGAGE.