These are the best expert tips for doing Christmas on a budget this year

These are the best expert tips for doing Christmas on a budget this year


Every year we tell ourselves not to overspend at Christmas, to think carefully about the presents we buy and to prepare diligently to enjoy a stress-free festive season.

Now it’s December 1, panic will inevitably set in and, before we know it, we’re kicking off the new year with a debt hangover. But given the cost-of-living crisis, we really do need to resist festive spending fever and consider what we’re buying – and why. Not only to ease the financial burden but the emotional one.

‘Children anticipate Christmas as a “magical event” and that anticipation doesn’t disappear just because we grow up,’ says Mark Vahrmeyer, psychotherapist and founder of Brighton and Hove Psychotherapy.

‘We put enormous expectations on Christmas as an almost redemptive event that will somehow confirm we are good people and have good relationships in our families. This is reflected in many Christmas TV adverts.

‘Much of this is tied to gift-giving, which often takes centre stage in adverts as if it’s imbued with some magical power that not only pleases the recipient but somehow transforms the whole experience into something magical.’

As Vahrmeyer notes, the tradition of gift-giving is as old as humanity itself. ‘It would have had multiple social benefits such as building bonds of trust, solidifying friendships, paying respect and cementing social status, as well as being a gesture of love,’ he says. Even animals do it as a form of connection.

‘But as Christmas has become intertwined with capitalism, so the “value” of a gift can become intertwined with social status. It can propel people to spend beyond their means.’

There are other factors at play, too. ‘Christmas can bring up complex memories and one of the ways to cope with difficult or ambivalent feelings is to go out of our way to create the “perfect” Christmas,’ says Vahrmeyer. ‘The unconscious fantasy being that as long as “everything is perfect”, the sad or bad feelings can be kept at bay.’

It’s also a time when families come together in a way they do not at any other time and old dynamics and behaviour patterns can return. ‘Sibling rivalry, envy, competition and inadequacies can play out with adults. This can mean people lose sight of how much they wish to spend and on whom,’ he says. And that’s just for starters. Wanting to be liked or loved also plays a significant role where gift-giving is concerned.

‘You might think if you don’t spend money, the other person is going to feel less valued, or they are not going to feel the love or connection we want them to,’ notes Dr Jenna Vyas-Lee, clinical psychologist and co-founder of mental health service Kove. ‘That’s because our brains are wired to associate giving, love and connection with money and material gifts, especially if your family script is to spend lots of money to show your love. Social media and marketing can feed into this.’

At this time of year, the music, scents and festive buzz can result in sensory overload. ‘Unless we are aware of at least some of these tactics, our brains will automatically react and we can end up being a tad more impulsive on our shopping trip,’ says Kate Nightingale, head consumer psychologist and founder of Humanising Brands.

The reality is that buying something on a whim will cost more and mean less than a gift that shows you’ve put thought into it – and that has nothing to do with the monetary cost. It could be something small you remember they mentioned in passing, a framed photograph of a treasured memory, or organising an activity you can enjoy together in the new year.

‘Ask yourself: if you buy this thing, is it really going to express how you feel about them? Can you make something without spending money? Can you provide an experience instead that would mean more to the person?’ says Vyas-Lee.

Don’t be afraid to bring up the subject of doing things differently this year with friends and family. Relieving them of the societal and financial pressures is a gift in itself.

‘It can feel easier to spend that extra £20 than have that conversation but people will appreciate you doing it. Set budgets, organise secret Santas, or even choose a theme such as books this Christmas,’ she says. ‘It might not go down well with everyone but ultimately not everybody’s going to have a positive reaction to what you do. And that says more about them than you.’

Don’t panic buy

‘The trick to avoiding impulse shopping lies in planning,’ says Brean Horne, personal finance expert at NerdWallet. ‘Create lists for all of your intended purchases – presents, food, decorations, events, travel. Set a budget, note it down and refer back to your lists before purchasing. This will help you stick to a limit.’

Create a gift prenup

‘Many people feel obliged to buy gifts for others they know they won’t use, with money they don’t have and cause themselves stress they don’t need. To fulfil that obligation, we do tit-for-tat giving. Instead, agree to a pre-Christmas “No Unnecessary Present” pact. Less cost, less debt,’ says TV host and money guru Martin Lewis.

The shift in giving in stats

● Nearly one in ten (8%) of UK adults won’t be giving presents to others for the first time. The same number will donate to a charity instead.

● More than a third of us (37%) will do stockings this year and five per cent intend to do secret Santas.

● It’s reported that 14% are planning to agree a set budget for gifts with family and pals.

● More than two-thirds (68%) look to make savings on gifts.

● 52% won’t compromise on gifts.

Source: Tesco Christmas Report 2022.

Get ‘appy

The Too Good To Go app allows you to buy and collect food from restaurants and supermarkets that would go to waste; and free budgeting apps such as Emma track spending,’ says Tara Flynn, a personal finance expert at Choose Wisely. ‘Sell unwanted items on Facebook Marketplace and eBay for extra income.’

Keep a lid on Xmas dinner

‘At least three-quarters of the Christmas plate should be cheap and seasonal cooked veg, such as bacon fat-sautéed sprouts and braised red cabbage,’ says Ben Ebbrell, chef and co-founder of Sorted Food. ‘Free-range chicken is easier and quicker to cook than turkey. Avoid waste through planning and portioning.’

Think practically

‘Useful gifts are always the best gifts,’ says Alexandra Stedman of who has teamed up with TK Maxx to share her savvy tips. ‘Kitchen essentials, hand soap and socks will be guaranteed to be used. Buy multipacks, such as candles. Split them up, wrap with ribbon and you’ve got a gorgeous party gift.’

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