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No mince pies for Santa

We’re dreaming of a frugal Christmas

Monday, 3 November 2008

Writes Hazel Cottrell
hazel.cottrell@consumerchoices.co.uk

Eight in 10 Brits will be cutting back on Christmas spending this year, according to new research.

Brits are cutting £102 from their Christmas spending this year, according to research from Birmingham Midshires. The average Christmas budget will be £604, compared to £706 last year.

The research shows that people are saving more, spending less on credit, and taking sensible money saving steps to make Christmas more affordable this year.

Tim Hague, director of savings and investments at Birmingham Midshires, said: “The financial climate certainly doesn't mean that Christmas is cancelled! Britons up and down the country will be cutting back on spending this year without sacrificing on many Christmas treats. This could have a very positive effect on New Year finances.”

The most common ways of cutting back are:

• Spending less on gifts (53% of survey respondents)
• Spreading the cost of Christmas by purchasing presents and other festive supplies in advance of December (46%)
• Reusing last year’s Christmas tree (34%)
• Staying at home for Christmas dinner rather than eating out (31%)
• Making Christmas dinner from scratch (25%)

The number of people paying for Christmas on credit has dropped considerably in the last two years. Just 11% of people will put Christmas spending on their credit card this year, compared with 41% in 2006.

More than one in three people who cannot afford to cover the costs of Christmas from their salary alone have savings set aside especially to pay for Christmas, and one in four Brits already have enough money saved up to cover 87% of the cost of Christmas.

Chris Eagle, commercial manager at CreditChoices.co.uk says: “It’s great to see that people are budgeting early for Christmas, but there are plenty of other things you can do to save money this year.

“If you are planning on making a lot of purchases this Christmas, it’s definitely worth looking into cashback credit cards. The American Express Platinum Cashback Credit Card (www.americanexpress.com) offers 5% cashback on all purchases for the first three months. Just remember to pay off your bill in full at the end of each month, and you will be rewarded with 5% of your spending returned as a cash payment!”

Compare cashback credit cards >>>

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