How to have a debt free Christmas

debt free christmas

After the Christmas tree has been packed away, the decorations are back in storage and the toys have been delegated to the back of the toy cupboard, the sparkle of Christmas can fade away and all that you are left with is your big fat credit card bill.

Last year, the Bank of England published figures which showed that in November, £1.5 billion was borrowed by means of loans and credit cards which is an increase from the previous year.

We know that we shouldn’t get into crazy amounts of debt just for Christmas, but that doesn’t mean that we will follow these ideals! There are many ways to make sure that you can still have an amazing time with your family over the holidays, but not cause yourself a lot of stress afterwards.

The best way to do this is of course to treat Christmas no different to the other days of the year and not give presents – but to suggest that everyone would do this would be silly, as I know not everyone would listen, which is why I have put together some tips for surviving Christmas debt free.


This is one of the most important things that you can do – not just at Christmas, but throughout every year. It will show your money where to go instead of you wondering where it all went!

Set yourself a sensible budget for food, decorations and presents. The lower you can get it, the better.

Make a Shopping List

Write a list of everyone that you are going to pay for – make this list as small as possible – we only buy for our immediate family even though my husbands side of the family are very close-knit, they understand that it is much easier on our bank balance to keep our list small. You can then work out a budget for each family member.

Tick off the items on the list as and when you get them, and if you are hiding them, make sure you write down where you are keeping them so that you can actually find them come Christmas!

Set Expectations

As difficult as it may seem, you need to speak to your family members that you are buying presents for and give them real expectations of the amount that you are able to spend on them. If your children are young then they won’t fully understand Christmas yet which gives you the perfect reason to not spend loads! If your children are older and understand about Christmas and money, then this is good too because you can sit them down and explain to them that money is tight and they can’t get everything that they want.

Your kids won’t mind – I bet they will still be happy at Christmas time and only remember the time that you all spend together rather than the huge list of gifts.

Start Saving As Early As Possible

In all aspects of life, the earlier you start saving, the better. If you start saving early then you will be better prepared to stick to your budget and get the gifts you wish to buy without becoming stressed.

debt free christmas

Save Up Your Loyalty Points

There are lots of different loyalty cards available in some of the main shops which they have to encourage you to shop with them instead of a competitor. For example, Sainsbury’s Nectar card, Tesco club card, Boots advantage card – these are all loyalty cards where you are able to save up the points and use them in one big go for a present or food. By saving these all year round it’s like getting ‘free’ money which you can use to alleviate some of the holiday costs.

Buy at Second Hand Stores

By this I mean sites like eBay, Gumtree, Facebook, and then also places such as car boot sales and charity shops. For some reason they have a bit of a stigma attached to them that they are full of tat, stuff that nobody wants and are in bad condition, but I find a lot of great things at these places – it’s just a matter of looking. It isn’t all second hand either – there’s brand new items in the packaging that people just needed out of their house for reasons such as needing more money quickly, moving house or just having a clear out.

For my daughters birthday this year, I didn’t have a lot of extra cash, but I do like to get her presents that she will really enjoy, so I headed down to my local car boot sale. I managed to find a brand new Gruffalo book for 50p, wooden dolls house furniture, other Julia Donaldson books, Disney Princess activity books, Mr Men books and more – all costing no more than a few pounds each – and she absolutely loved them.

My advice would be to go to some with an open mind and see what you can find – maybe set yourself a challenge to find a certain amount of presents under £5?

There are freebie sites as well such as Freecycle, Freegle, freebies section on Gumtree and more, where you can pick up items that people are getting rid of for free.

Use Cash

One of the best ways to keep your spending under control is to use cash only. Withdraw the exact amount that you have in your budget and don’t get out any more. Using cash will make you physically see how much left you have to use which will help you stick to the budget and think more about each purchase.

This doesn’t mean that you should take out as much cash as possible, but to give yourself a sensible figure that you think you can stick to. If you use card to pay for items, it’s easy to let the purchases add up and up.

Homemade Gifts

One of the most frugal things that you can do at Christmas time is to make your own gifts. These could be crafty items such as knitted scarves, or homemade food gifts like a Christmas cake, or just a delicious stack of cookies. The kids will love to help you make these for their family and friends.
If you are stuck for ideas – Pinterest is the best place that you can go for these kind of things. Check out this post on Miss Thrifty for how to make salt dough decorations.

debt free christmas

Make Travel Arrangements in Advance

Travelling to see family in the holidays is a personal choice – but if you can’t afford it, don’t feel bad, just explain the situation and your loved ones will understand. If you are definitely going to travel, then price it all up as early as you can and look for deals.

Free Activities

If you are hosting over Christmas, or you are just enjoying (/going crazy) having your children off school, then it can be easy to feel the need to ‘entertain’ everyone and spend a lot of money on trips or meals out. Your family want to spend time with you – it doesn’t need to be doing something expensive.

I have a list of free or budget activities that you can do, or do a search on Pinterest and it will bring up some fab ideas.

Save On Food

Food is one of the large expenses at Christmas time, especially if you are hosting and have all of the family over. Whilst it’s nice to eat a lot at Christmas, it’s not necessary.

If you are doing a roast dinner, then this should just be around the same cost as a normal roast dinner – make sure you get the portion sizes correct, although you could always eat the leftovers – turkey sandwich anyone? On the subject of turkey, do you absolutely need to have a turkey? In my family, we usually stick to a roast chicken – much cheaper and we aren’t bothered in the slightest that it’s not turkey.

My best money saving tip for food at Christmas time is to get everyone to bring something. So if you are hosting and you are doing the roast, have someone bring a starter, someone else bring a dessert, someone else bring drink…and so on. This should alleviate any potential extra costs, especially if you are cooking for a lot of people.

debt free christmas

Use Giftcards

There is a website that I have mentioned on here before, where you can get reduced gift cards, or sell your unwanted gift cards on there. You could buy a reduced gift card as a present (I’ve got a Nando’s one for my husband for Christmas), or you could get a supermarket one and use it towards your food.

Get Freebies

There are a bunch of freebie sites out there where you can sign up to be sent freebies from companies if you give them your address. There are only a limited supply so be fast and you could get some to give as presents! I’ve received some Dior mascara, a jewellery making kit and more!

If you don’t want to give the freebies as a present, you could donate them to charity as a way of giving back even when you’re skint.

Have a Secret Santa

If you have a large family or circle of friends (or both!) then suggest doing a Secret Santa – where you are each given a name and have to buy that person a present. It’s a great way of cutting down on costs and everyone enjoys doing it! My husband’s side of the family is huge and they were spending a ton of money on Christmas presents for each other, but they now do a Secret Santa and everyone is much happier with it.

Get Cashback When Shopping Online

If you are buying items online, make sure that you are signed up to cash back sites such as Quidco and Topcashback, where all you need to do is type in the name of the website that you wish to purchase from, then click through and buy your item like you usually would. The cash back sites track this click through and you are given cash back – the percentage of cash back will be displayed on the cash back site before you go onto the other site.

Christmas Cards

Have a think about whether you need to send Christmas cards or not – if you are broke, your family and friends will understand why you don’t want to spend any money, but if you really want to send cards, how about making some homemade ones with the kids? You can get card pretty cheaply and decorate with handprints to make the shape of angels, reindeer etc.

The best time to buy Christmas cards (and wrapping paper) is in the January sales, so keep a look out in January! Same goes for gift bags if you like to buy them, keep a hold of any in nice condition that you are given so that you can re-use them.

Enter Competitions

Competitions are great because you are getting stuff, for free! You can win cash, cars, holidays, trips, DVD’s, clothes and more. Get a new email address specifically for your comping, and check out the main competition sites. Competitions where you have to make a little bit more effort such as taking a photo, will have less entries so you will have more chance of winning.

Sell Your Things

I don’t mean you should sell all of your furniture in order to pay for Christmas, but to sell your things that you don’t really need. Old kids clothes, toys, smellies – have a look in the garage or the attic. Not only will this mean your house gets a good clear out, but you get some extra cash and space for presents.

Make Extra Money

One of my favourite things is to get more money flowing in, especially if I know that there will be more cash flowing out! There are many things that you could do to get some extra money in time for Christmas, such as:

These are all ways that I personally make extra money and I enjoy doing them all. Mystery shopping is great because on top of the money you can get free items that you have to buy as part of the shop such as clothes or shoes, that you could then give as a present.
If you really want to have a debt free Christmas, making some extra money is a great way of taking off some of the pressure that you may put on yourself. A lot of stores take on additional festive staff too so you could always put in an extra shift – it only has to be temporary.

Christmas falls on the same day every year, so being prepared and planning for this day will help you still be able to have a wonderful time with your family, without having to pay for it in the future.
Does anyone have any other tips on how to have a debt free Christmas?
how to have a debt free christmas

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