New research from Lloyds Bank reveals Britons spent an average of £465 each on Christmas 2016, with a majority admitting to not making an overall budget. Moreover, one-in-ten (11%) respondents spent over £1,000 over the festive period, while almost one in five (17%) of those with children in their household admitted to spending more than £1,000.
Planning ahead for the cost of Christmas is a challenge. Of the 2,000 respondents polled by YouGov for Lloyds Bank, over half (54%) didn’t set a budget for Christmas 2016, or only budgeted for part of their spending. Less than a quarter (22%) set a budget for all of their Christmas spending in 2016 and stuck to this – while a further 12% set a budget but didn’t stick to it.
Budgeting appears to pay off. Those who set a Christmas budget spent a little less overall, at an average of £462 this winter, and their total cost of Christmas actually fell by 3% compared to 2015. Despite this, even those who budgeted spent more than expected in December 2016 by an average of £53. Yet by contrast, for the majority that didn’t make an initial budget, the cost of Christmas rose by 5% compared to 2015, reaching an average spend of £474 for those who didn’t make an overall Christmas budget this winter.
The challenge of paying for the cost of Christmas is often bigger for those who received an earlier pay cheque in December, according to the research. A third (33%) of those who face a longer gap between pay days in December and January admit their finances will be trickier to manage. Yet less than half of this group (42%) planned for the longer period between receiving their income. When it comes to funding the cost of Christmas, in 2016 just over a quarter (26%) managed to save money in advance for Christmas, while over a fifth (22%) used a credit card and more than one-in-twenty (6%) used their overdraft.
Jon Roberts, Managing Director of consumer & commercial cards at Lloyds Bank, says “Make no mistake, the cost of Christmas can be hefty, but as a nation we don’t do much to make it easier on ourselves. Our research shows that we fail to budget properly, which leads to unexpected overspending, and we don’t plan for a longer gap between pay cheques in December and January either, both of which can make managing our money trickier in the New Year.”