Festive Debt

The festive period is supposed to be the most magical time of the year, but for some, it can also be the most stressful. From decorations and gifts to food and travel, many people feel pressured to borrow money to cover the cost, leaving them dealing with unaffordable debt come the new year.

In this guide, we’ll look at festive debt in more detail, including what it is, how to avoid it, and what to do if you can feel yourself getting caught up in the spending frenzy of the festive season.


The festive period brings joy and happiness, but for many, it also ushers in a wave of financial stress known as festive debt.

As the holiday season approaches, individuals often find themselves grappling with mounting expenses, relying heavily on credit cards and payday loans as a way of funding Christmas.

In this article, we delve into the reasons behind the prevalence of festive period debt, explore the pitfalls that lead people into this predicament, and provide valuable tips on how to avoid sinking into debt during the most wonderful time of the year.

What is Christmas debt?

Christmas debt refers to the financial burden and strain that individuals experience as a result of overspending during the holiday season.

The combination of great financial pressure to create a perfect Christmas experience, the reliance on seasonal jobs with uncertain income, and the often overlooked hidden expenses can contribute to the accumulation of debt.

Many people feel compelled to purchase expensive gifts, indulge in lavish feasts, and decorate their homes extravagantly, often exceeding their budgetary limits.

Additionally, the costs of travel, parties, and hidden expenses like higher utility bills can catch individuals off guard, making their financial problems worse.

How can I avoid festive debt?

Amidst the Christmas celebrations, it can be all too easy to forget the impact that spending can have.

However, the reality is not considering spending in December can have a far deeper impact than just a festive hangover and the January blues.

By being prepared and sticking to a strict budget over the holidays you are in the best position to stop your bank balance being pushed to breaking point.

Below, we shine a light on a few simple steps you can take to avoid falling into financial difficulty.

Top tips to avoid Christmas debt

Know your priorities

Ensure that all priority bills such as your mortgage, council tax, electricity, and phone bills are paid before you begin any festive spending.

Start Christmas shopping early

Planning ahead and putting a little extra money away each month in the run-up to Christmas will give you a little wiggle-room when it comes to spending in December.

Set a budget for the festive season

Make sure you don’t get caught short for December bills by taking note of all monthly expenses and deducting them from your income.

You can then create a realistic budget and stick to it to avoid a shock bill at the end of the month.

Keep track when you spend money

Sticking to a strict budget may seem easier said than done at times but by keeping track of what you spend you’re more likely to keep spending on track.

Record any festive spending and be sure to keep an eye on your bank balance to avoid any surprise interest or overdraft charges.

Shop around during the holiday season

It may be a season of giving but that doesn’t mean buying Christmas presents needs to break the bank.

Be sure to shop around when you begin your quest to find the perfect presents to ensure you get the best deal.

Use trusted sources

It’s also important to always buy from reputable outlets when shopping to offer greater consumer protection.

Even if you’re struggling to find this season’s most sought-after gift for your child, don’t be tempted to buy through third parties to avoid inflated costs.

Avoid unplanned overdrafts

If you do find yourself in need of extra money, don’t count on an overdraft without speaking to your bank first.

It is more expensive to find yourself in an unplanned overdraft rather than arranging one with your bank.

What should I do if I find myself in festive period debt?

Despite the best of intentions, sometimes there is no avoiding overspending during the Christmas period.

It can be all too easy to get caught up in the frivolity of the season and throw caution to the wind when it comes to budgets and spending.

Below are some steps that you can take if you find yourself in that situation.

Don’t hide from your debts

When faced with festive period debt, it’s crucial not to bury your head in the sand. Ignoring the problem will only make it worse.

Instead, confront your debts head-on and acknowledge the situation. By acknowledging the issue, you can take the necessary steps to resolve it.

Contact your creditors

Reach out to your creditors as soon as possible. Explain your financial situation and discuss possible solutions with them.

They may be willing to negotiate a revised payment plan, temporarily lower interest rates, or provide other alternatives to help you manage your debt effectively.

Clear communication can open up opportunities for finding mutually beneficial resolutions.

Seek reliable debt advice

Consider seeking guidance from reputable debt advice services. These professionals specialize in assisting individuals facing financial challenges.

They can help you assess your financial situation, explore available options, and provide personalised advice tailored to your needs.

They may offer insights on budgeting, debt consolidation, or debt management strategies to help you regain control of your finances.

Consider using a debt solution

Depending on your circumstances, a debt solution such as a Debt Management Plan (DMP) or an Individual Voluntary Arrangement (IVA) might be worth considering.

A DMP involves consolidating your debts into affordable monthly payments, while an IVA is a formal agreement with creditors to repay a portion of your debts over a fixed period.

These solutions provide structure and assistance in managing your debt effectively, allowing you to work towards becoming debt-free.

Where can I get debt advice for Christmas debts or other financial difficulties?

If you find yourself struggling with debt, taking prompt action, communicating with creditors, and seeking professional advice are crucial to regaining control of your financial well-being.

At Talk About Debt, our knowledgeable advisors are here to provide you with valuable insights and assistance, empowering you to overcome your debts.

Contact us today for debt advice and festive period debt help that’s tailored to suit you and your financial circumstances.

Key Takeaways

Festive debt refers to the financial hardship many people experience in the new year due to overspending over the holidays

Festive debt is extremely common and many people feel pressured to spend more than they can comfortably afford

There are steps you can take to avoid festive debt, such as shopping early, setting a budget, and keeping track of your spending

Ignoring festive debt will only make the problem worse

Consider using a debt solution or seeking reliable debt advice to help you manage festive debt effectively