Hands up if you’re worried about cash this Christmas. According to new research from Credit Karma, 20% of us are concerned about the rising costs of the festive season, and we’d be surprised if that figure wasn’t a little higher across the population at large. 

Whether you’re single and lining up nights out with mates or hosting a big family Christmas, December is the costliest month of the year for many. The Bank of England estimates that the average UK household spends £700 more in December than in other months, and even if you’re attempting a restrained celebration, most of us will have at least a couple of gifts to buy. 

The festivities are creeping into the rest of the year, too. The shopping madness starts earlier and earlier each year (big shopping events such as Black Friday are in November, for example) and some Christmas parties drift into January, ostensibly to reduce costs. Not to mention the January sales.

With this in mind, we’re taking a look at the research to ask if the cost of Christmas is becoming prohibitive, as well as looking at ways to manage it – ideally without changing the face of Christmas celebrations as we know them. Because, let’s face it, nobody wants festive FOMO, right?

According to the research, the average Brit will spend £460 on socialising this Christmas, and we imagine this is considerably more if you live in and around London, where the average cost of a (non-festive) night out is around £50. 

Given the ongoing cost of living crisis, it’ll come as no surprise that the biggest expense is hosting food and drinks for family and friends, closely followed by attending Christmas lunches or dinners, and spending at Christmas markets. In addition, we’re expected to attend work functions, parties and meals, so it’s easy to see how even a few nights out can add up – and that’s before we’ve even seen our mates.

We know that the friendship wealth gap is real, too, and December gatherings can tip even the most cash-savvy friend into money stress. The stats agree, with one in 10 of us admitting we can’t keep up with social plans, and some of us even pretending to be ill or busy to avoid having to attend events. 

It’s not a huge stretch to see how this can put a huge strain on our mental health – just in time for the most miserable month of the year (yes, January, we’re looking at you here), but there are ways to manage the festive financial burden. 

“The financial hit of socialising at Christmas can often be overlooked when we are in the swing of the season,” says Amelia Murray, money expert at Be Clever With Your Cash. “It can be tempting to say yes to everything without considering the cost on top of what we are already spending on festive celebrations, such as gifts for loved ones and travel. But there are ways of managing it so you don’t miss out or suffer from a financial hangover come January.”

While we can’t offer a magic wand, there are some simple ways we can all plan for a financially savvy festive period. 

“Christmas is an exciting time of year, but it can quickly become stressful if we’re not being mindful about overextending ourselves financially,” says Akansha Nath, general manager at Intuit Credit Karma. “However, with some thoughtful planning, we can enjoy the festivities without compromising our financial wellbeing.”

Here are some tips to help you make the most of the season while staying within your budget. 

1. Set a spending limit

Establish a budget for gifts, social events and other holiday expenses. “Breaking down your spending into categories will help you avoid overspending and ensure you only spend what you can afford,” says Nath. “If you’re stressed about costs, have honest conversations with your friends and family.” 

It’s likely you’re not the only one concerned about spending, so chatting it through with others will not only help you feel supported but may also create solutions. A secret Santa-style gift exchange with family members, for example, can help keep costs down as you’re only buying one present. 

2. Plan ahead for gifts

“Start shopping early and keep an eye out for sales and promotional periods like Black Friday,” advises Nath. “Planning ahead allows you to take advantage of discounts and avoid last-minute shopping, which can be costly. If you’re worried about the cost of gift giving, consider setting up a gift exchange that only requires each participant to give just one gift.”

3. Take the lead in organising plans 

If you’re concerned about friends or family members always arranging expensive treats, try offering to organise activities yourself instead. “Take the lead in organising plans and open up conversations with your friends and family around money early,” suggests Murray. “That way you can make sure you are happy with what is being organised and suggest ways to match the average budget of each person rather than the highest earner. Most people will be glad of this approach at such an expensive time of year – not to mention glad they don’t have the burden of organising everyone.” 

4. Stay local

Don’t overlook the events happening on your doorstep. Often, they’ll be far cheaper than travelling further afield. 

“Keep an eye out for discounts for activities that you can do as a group or cheap (and often free) local events, such as community carol concerts or festive film screenings,” says Murray. 

Images: Getty