The Christmas Debt Hangover Effect
Scary facts time, the average family spent more than £800 on Christmas. Nearly a quarter, 23%, of us felt under pressure to spend more than we could afford (according to research from National Debtline). How was it for you? Did you spend more than you had planned? Did you end up with Christmas debt spending more than you could afford to? Well here is a tool to make sure you avoid the christmas debt hangover effect.
How was Christmas for us?
Most of our spending went onto a cash back credit card that gets paid in full every month to avoid any interest charges. I had been trying to spread the cost of Christmas over a few months. Our November spending was paid at the beginning of January, not the best of timings and the bill came in at £600 higher than normal. Our December spending is paid at the beginning of February and that is £400 higher than normal. This extra £1000 has hurt and the extra money has come out of now much depleted savings.
This spending was even with us agreeing to not not do gifts with some family members and friends that we have always exchanged gifts with in the past. I spent too much on the children again 🙁
For next Christmas I am going to try something different, I am going to give a Christmas Savings card a try. You often hear about savings clubs but I have always been quite cynical due to the worry about where my money would be held and what if the company went bust (I think I remember that happening a few years ago!).
The Asda Christmas Savings Card is a bit different, firstly Asda is extremely unlikely to go bust! You can save up to £144 over the year on each card. At the end of every shop you can add a regular amount onto the card or maybe round up your shopping to £100 and put the difference onto the card. Adding on small amounts to the card every time you shop will be less noticeable to the weekly budget.
How Does it Work?
Pick up a savings card in store, they look like this one. The one I am going to start saving on. Once you reach the limit of £144 on a card just pick up a new one and start saving on that one. As soon you start saving on a card ensure that you register it here clicking here. That way your balances are protected should you lose the card.
Once you have saved set amounts on the cards you will be eligible for a bonus in November just in time for the gift and food shopping.
- Save between £49 and £96 means a bonus of £1
- between £97 and £143 means a bonus of £3
- and savings of £144 means a bonus of £6
This approach to Christmas and is a great way of saving up a chunk of money to cover the cost of Christmas treats and gifts. How lovely would it be to not have an extra credit card bill after Christmas? Or to not have to take out a short-term loan to pay for something after the event has happened?
If you saved £10 per week from now until November, you would have a total of £450! That would make you eligible for 3 lots of £6 bonuses so an extra £18. That’s £468 to cover Christmas spending. If you could stretch to £20 per week that is Christmas pretty much covered with £936 on card!!
All the money saved on the cards will need to be spent in Asda. Here is a handy FAQ section from the Asda website if you have any other specific questions.
This is a collaborative post.