Credit, Collections & Insolvency News
New research by Thinkmoney has revealed that the average household is set to spend £787 on the festive season an increase of £87 on last year.
Despite spending more, many feel they are getting less, and some would rather skip the holiday altogether: almost a third of people (30%) say they would cancel or delay Christmas if they could. The pressure is felt most sharply among 35–44 year olds, who not only face the highest average spend at £1,115 but are also the most likely to want out, with 37% saying they would cancel Christmas if given the choice.
The study conducted by Censuswide for all in one banking app thinkmoney, comes to footing the bill, credit cards will be the most common way to fund the festivities (25%), followed by Buy Now Pay Later (BNPL) schemes (14%) and borrowing from family or friends (7%) outside of using regular income (51%) and savings (42%). And while BNPL will account for just one in seven shoppers this year, its appeal is widespread: 47% say they find BNPL attractive as a way to spread the cost of Christmas, rising to a striking 73% among 25–34 year olds.
The financial hangover will drag well into 2026, with only 22% of shoppers expecting to have cleared their festive bills by the end of December. A further 21% say they will still be paying off Christmas in January, 18% expect to be in debt into spring or summer, and 3% admit they may still be paying off Christmas 2025 as late as August 2026 or beyond.
To try to soften the blow, many people are already starting their festive budgeting – with 26% saying they begin planning their Christmas budget by September or earlier. Even so, cutbacks are widespread: 35% plan to spend less on nights out, 31% on adult gifts, 27% on decorations, 18% on Christmas dinner food shopping, and 15% on heating and energy.
Vix Leyton, Consumer Expert at Thinkmoney, said “This is shaping up to be one of the tightest Christmases in recent memory, and unfortunately for Brits, the rising cost doesn’t mean more trimmings. Despite spending more, families are unfortunately finding their money has never been worth less – with the cost-of-living putting pressure on already limited budgets.
“Worryingly, Buy Now Pay Later is set to play a big role, which risks turning festive fun into a debt timebomb that will echo well into 2026. With adverts screaming at you to celebrate in style, and a long list of presents to get, it’s easy to see the temptation of spreading the cost, especially when it is so easy. But before putting Christmas on credit, it’s worth weighing up exactly what’s important to you and what’s just noise. For the essentials, planning early is key to create the biggest run up and bag the best bargains, and remember that Christmas is about celebrating with the people you love, not how much you spend.”