Worried about the cost of Christmas? Here are six ways to share costs, set boundaries, and take the pressure off

Words: Camilla Foster. Images: Shutterstock.

If you’re starting to think ahead to the festive season, before you get your party dress ready and the turkey on order, there’s another important job you’d be wise to do: have some conversations about money with your nearest and dearest. Because, unless you’ve recently won the lottery, this time of year can put a strain on all of our purses.

It’s easy to get into trouble by spending a little extra here, or splashing out there, all in the name of making Christmas ‘special’ – or to keep up with, and perhaps impress, friends and family. But all those little treats and extras can quickly add up to a big heap of cash. This type of spending during the festive season – and the looming fear of debt that accompanies it – can leave us with a nasty financial hangover in January.

But in order to avoid a short, sharp budget shock, or to experience some awkward conversations about unmet expectations on Christmas Day, now’s the time to chat through what you’re thinking and planning, to make sure you’re all on the same page.

Be open and honest

Setting clear expectations ahead of time can prevent stress and awkwardness. ‘Speak directly to your loved ones to understand their financial situations better and communicate yours openly as well,’ says Rajan Lakhani, personal finance expert at smart money app Plum. ‘This means you will all be on the same page when it comes to buying presents or sharing Christmas expenses.

It can feel like quite an awkward conversation, but you may find that others in your group have been having the same worries and will be relieved to get it out in the open.’

Share out the labour and costs of Christmas lunch

‘We’re still in a cost-of-living crisis and the expense of turkey and trimmings can be higher than people expect,’ highlights Lakhani. ‘Many families arrange for each person to bring a dish as a contribution, which cuts down labour as well as cost for the host. Arrange a contribution from each individual adult rather than per couple, so single people don’t end up shouldering more of the load.’

If you’re throwing a party, consider asking guests to bring a bottle or two

‘You can potentially save hundreds of pounds if you take alcohol out of the equation,’ says Amy Knight, NerdWallet UK’s personal finance expert. ‘Ask guests to bring a bottle of whatever they’d like to drink so that you only have to fork out for the food.’

Don’t be afraid to say ‘no’

Be clear about what you’re comfortable with, and remember to prioritise your wellbeing. ‘Don’t be afraid to say “no” if you can’t afford something,’ says Maxine McCreadie, personal finance expert at UK Debt Expert. ‘It’s important to prioritise your financial wellbeing over holiday pressure. Remember that Christmas is about spending time with loved ones, not spending beyond your means.’

Respect that everyone’s situations will be different

‘Gifting can be a great source of pleasure, particularly for relatives who have fewer financial pressures, or more disposable income,’ says Knight. ‘Respect your grandparents’ right to spoil you if they can afford it, but be open about the fact that your circumstances won’t allow you to spend the same amount in return.’

Encourage children to be creative with presents

‘Children shouldn’t feel pressured to buy expensive gifts. This can set a dangerous precedent for overspending later in life,’ says McCreadie. ‘Encourage them to get creative by making something, baking, or offering a kind gesture, such as a handmade voucher for spending time together. Teaching children about thoughtful, budget-friendly giving can be a valuable lesson in the importance of the holiday spirit over materialism.’

Set spending limits on presents

‘Speak about spending limits and boundaries for presents, either in the amount of money spent or the number of presents bought,’ advises Rachel Kerrone, a personal finance expert. ‘This will then make sure you don’t spend more than you can afford, and will help avoid feelings of guilt for spending less on presents.’

Opting for Secret Santa or agreeing on an age cap on kids’ gifts can help keep costs down.‘If you have a large family with lots of nieces and nephews, discuss with your siblings what age you stop buying presents for each other’s children,’ adds Knight. ‘For example, those under the age of 10 might enjoy a present under the tree, but tweens and teens who have their own current account may prefer a few pounds to spend themselves.’