Christmas may still seem far away, but with the cost of living crisis threatening to affect many families' usual Christmas traditions, worries about affording Christmas will have already begun in households across the country.
Energy price hikes and rapidly rising inflation are eating into our back pockets and this undoubtedly affects many of us when it comes to the end-of-year celebrations this Christmas. This report reveals the expected 2022 Christmas spending and saving behaviours of 2,000 people across the UK.
September was revealed as the most popular month to start saving for Christmas, followed by January. If you're planning on saving up to fund Christmas next year, compare the best savings accounts here.
September was revealed as the most popular month to start saving for Christmas, followed by January.
Households with three children are more likely to start saving in January, while those with fewer children are more likely to start saving in September.
Those aged between 18 and 24 are three times less likely to save for Christmas than those over 54.
Just under half of the responders have reduced their Christmas budget this year.
33% of women reported they are worried about how Christmas will affect their finances this year, compared to a quarter of men.
Households with children were more likely to be worried about how Christmas will affect their finances in 2022 than those without.
One in five people expect to fund this Chritsmas using credit cards.
Around 23% of credit card users expect to still be paying off credit card debt six months after Christmas.
Almost 30% of credit card users expect to spend over £1,000 on their credit cards this Christmas.
The most common Christmas budget in the UK is between £301 and £500.
Households with four or more children were more likely to report expected spending of £1,000 or more.
Throughout the UK, the most common amount consumers are expected to spend on Christmas is between £301 and £500, with over 30% of respondents reporting they spend this across presents, food and drink, activities, and decorations. The least likely budget for Christmas this year was £1-£100, seeing just 6.5% of responders vote for this. Closely following this, only 6.9% voted they would spend over £1,000.
When looking back to Christmas last year, most responders (28.70%) also reported they were most likely to spend between £301 and £500 1.6% less than the 30.30% this year. There was a 7.3% increase in people spending between £101-300 and a 3.95% reduction in people spending between £501-£800. This suggests several people are reducing their spending this year.
This year 35.1% of responders reported they are looking to spend over £500, and just 6.9% reported they were looking to spend over £1,000. Compared to last year's budgets, 44.7% were spending over £500 and 9.65% were spending over £1,000, showing that the number of people spending in these brackets has decreased.
When reporting on their expected Christmas budget, the majority of respondents reported that they were looking to spend between £301 and £500 this year (30.30%). 18-24-year-olds were the only age group to break this trend, with 34.99% opting for the lesser £101 - £300 bracket. 45-54-year-olds were the most likely to spend over £1,000 with 32.76% opting for this bracket.
Households with no children also showed a preference for spending less than those with children. 35.04% without children voted for the £101 - £300 brackets, whereas households with 1 or more children consistently reported they were more likely to spend between £301 and £500 (32.57%, 32.64%, 23.94% for 1, 2 and 3 children respectively), except for those with 4 or more children, who reported they were more likely to spend over £1,000 (26.09%).
Just over one in five respondents start saving in September (20.05%), followed by January which is when 14.45% of respondents begin saving for Christmas.
Only 14.40% of respondents do not save at all for Christmas. This appears to be largely made up of those over the age of 45. Almost 30% of respondents over 54 reported that they do not save for Christmas, compared to just 10.5% of 18-24 year-olds.
Wales was the only country in the UK whose majority (17.59%) begin saving in January. Northern Ireland had the largest proportion of respondents who don’t save for Christmas at 17.31% while England had the lowest, at 14.04%.
A majority of households with three children opted to save from January (21.13%) suggesting they like to save for a longer period of time. Surprisingly, however, households with four or more children were more likely to opt for September (23.19%).
Across all demographics (excluding those over 54) respondents voted in a majority for having reduced their Christmas budget this year. This is true for males and females, all countries in the UK, and all households with children. Just under half (49.70%) of all respondents lowered their spending this year, with just 14.95% stating they had increased their Christmas budget.
Just under 30% of responders reported they were worried about how Christmas will affect their finances this year. A further 28.15% reported that they had started saving earlier than usual and almost 18% suggested they would spend less money on Christmas this year. Only 22.85% reported that they would plan Christmas as they always do.
Just over 27% of men reported that they were more likely to plan for Christmas as they always do, whereas women were more likely to report that they were worried about how Christmas will affect their finances this year. In fact, 33% of females (around 1 in 3) responded that they were worried about their Christmas finances, compared to just 24.89% of males (around 1 in 4).
Households without children also reported they were less likely to be worried about how Christmas will affect their finances in 2022 at 26.34%. Households with children consistently reported that they were worried about their finances this year, with 2 in 5 households (40.14%) with 3 children reporting being worried.
When asked how they would finance their Christmas’ this year, just under 45% of respondents are planning on spending a little each month, 38.65% will use their savings, and 21.1% will use a credit card. This is equivalent to 1 in 5 people funding their Christmas with credit cards this year. 38.65% reported they were relying on savings and 5.3% reported they were using loans to pay for their Christmas spending. Just 10.05% of responders said they had not thought about how they would fund their Christmas this year.
Of the 21.1% of respondents planning to use their credit card to fund their Christmas spending this year, 48.82% expect it will take them between one and six months to pay this spending off. This suggests almost one in 10 people will be paying off Christmas credit card debt at the start of next year.
And although 27.96% of credit card users expect to pay off their debt within 1 month after Christmas, 6.16% expect it to take over a year to pay off.
Of the 21.10% of responders reporting they will spend on credit cards this Christmas, 37.20% suggested they would spend less than £500. Just under one third suggested they would spend between £501 and £1,000, with the remaining responders suggesting they would spend over £1,000 on their credit cards.
1 in 5 (20.05%) people in the UK reported they start saving for Christmas in September. As a general rule, the sooner you start saving the less you will need to save each month. This should make saving in the short term easier, as even small amounts saved over a few months can make big differences to your budget at the end of the year.
Christmas can be an expensive time of year, however, it is possible to still have an amazing Christmas on a budget. Here are some top tips on how to do so:
Set yourself a budget (& stick to it!) - Take the time to plan out precisely what you can afford to spend over the festive season. In addition to gift-giving costs, make sure to consider the costs of additional expenses, such as Christmas dinner, and seasonal decorations. Christmas is just 1 day in a year out of 365, so you don’t want to spend the following year paying for it.
Get cashback on your Christmas shopping - This top tip can be applied all year round. However, as shopping typically ramps up during the lead-up to Christmas, it becomes even more applicable. When you shop via cashback websites such as Top Cashback, they will give you back a percentage of your total spending. This essentially means that you are getting a discounted product, by simply purchasing through such websites. Some cashback brands, including Quidco, even offer in-store cashback opportunities, meaning that you don’t have to do all of your shopping online.
Make a list (& check it twice!) - Lists can help you to keep track of everything, including your spending habits. Take the time to create a list of the people you wish to buy a gift for this year, as well as your budget per person. Once purchased, make sure to write down how much you spent on each item. This will not only help you to keep track of your spending, but it will also help you to plan ahead for years to come. You can create lists for further Christmas essentials, such as decorations, food & beverages.
Compare Prices - One of the best ways to save money at Christmas is to shop around. For those shopping online, there are a series of different websites (e.g., idealo) that you can use to compare the prices of your desired items, thereby helping you to source the best price. Be sure to also take advantage of website extensions such as Honey, which automatically scour the web for discount codes and apply them to your online basket.
Don’t be afraid to talk about money - If you’re struggling with your finances, chances are that you aren’t the only one. If you can’t afford to indulge in a lavish Christmas, be honest with yourself, and those around you - chances are many people will be feeling the same this year! Opening up, and discussing your worries, can help to relieve the pressures of the festive period. If those around you truly care about you, they won't mind skipping the gifts this year (or any year, actually!).
Secret Santa - To limit the number of gifts you need to purchase, why not consider participating in a Secret Santa with friends and family? Throw each of your names in a hat, and decide on a maximum spend that you are all comfortable with. Secret Santa allows everyone to receive a nice gift, without breaking the bank.
Committing to specific amounts each month is much more effective than saving whatever you have left at the end of the month, which might not be enough. Be realistic in your saving estimations. It’s far better to commit to saving a smaller sum each month than to aim too high and give up.
General statistics for the survey population: 1,100 females and 900 males responded to this survey. 1,643 responders reside in England, with 157 from Scotland, 108 from Wales, and 52 from Northern Ireland.
All data was retrieved using Pollfish on October 29th.
Salman is our personal finance editor with over 10 years’ experience as a journalist. He has previously written for Finder and regularly provides his expert view on financial and consumer spending issues for local and national press.