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Overspending at Christmas (and how to avoid it)

Why is it that the sound of Christmas tunes and the smell of pumpkin spice has us handing over our cash like crazy??
Written by: Adele Halsall

Though the Christmas shopping process is stressful for most of us, it can also be fun and exciting (especially if you start early [link to ‘Last Minute Christmas Shopping’ blog post]).

However, if there’s one thing we can all agree on, it’s that overspending is all too easy when buying presents...and definitely puts a bit of a downer on January.

Here are the top ways we tend to overspend at Christmas (and how to avoid them).

 

 1. Buying Stuff For Ourselves

                  Overspending At Christmas   1 Shopping For Youself

Be honest - when out shopping for other people, do you end up buying something for yourself too?

I definitely do, and in the moment it can certainly feel that we’re making Christmas shopping that little bit more worthwhile.

However, this increasing ‘self gifting’ trend is damaging our bank balances - not to mention distracting us from the real task at hand.

How to avoid it:

Treat yourself to something nice, but only when all of your christmas shopping is done. That way you’ll have incentive to get it done quickly, and still be able to reward yourself for a job well done.

2. Making Impulse Purchases

                                Overspending At Christmas   2 Shopping Too Much

How many times do we go out to browse for presents, only to end up buying everything in sight? It can be all too easy, when we’re unsure of what to buy, to simply throw money at the situation and spend way more than we can afford.

How to avoid it:

Before going shopping, make a list of all the people you want to buy for and how much you want to spend per person (as determined by your budget). Write down a specific item for each person, or, if you can’t decide yet, write down a few ideas (being careful to take the most expensive item into account when working out your maximum cost).

Having a list of specific gifts to search for will make your shopping much more structured and you’ll be less likely to get distracted. If you overspend on one gift, remember you’ll have to try and reduce expense somewhere else to stay under budget.

3. Being swayed by cheap stocking fillers

                             Overspending At Christmas   3 Oh Okay

Similarly to the previous point, it’s all too easy to feel tempted by cheap stocking fillers that in the moment, don’t seem expensive but can quickly add up.

From stationary and mini perfumes, to mugs, novelty socks and gimmicky gadgets…stocking fillers can seriously add to the total bill.

How to avoid it:

Instead, stick to your gift-buying list and keep the cheap stocking fillers for those times you have budget left over...or for the office Secret Santa.

4. Too-Good-To-Miss Discounts and Deals

                                                   Overspending At Christmas   4 Must Have

Shops are infuriatingly good at convincing us that we need to buy something immediately, for fear it might run out or that the price might shockingly increase soon after.

They do this, of course, with sales, discounts and deals, creating what is known as the ‘scarcity effect’ which panics us into buying on the spot. As well as the big ones Black Friday and Cyber Monday, different stores will also run their own deals and offers at varying times throughout the season.

How to avoid it:

Sales and discounts are awesome for saving you money on costly items, but only when its stuff you really want. Stick to your list and always compare offers across retailers so you can be sure you’re getting the best deal.

5. Expensive Wrapping Paper & Accesories 

                                            Overspending At Christmas   5 Expensive

If you leave it too late to buy wrapping paper, prices can rise hugely - and department stores are always very clever at placing paper and tags so that we buy them impulsively.

How to avoid it:

Buy your wrapping paper and accessories from craft stores or card shops...or make your own wrap from recycled materials at home - magazines, newspaper, music sheets, or simple brown paper tied up with twine and a sprig of pine.

You could also use recycled wrapping paper from last year, or ditch the disposable wrap altogether and replace it with more sustainable options, like baskets or furoshiki cloth.

6. Unnecessary Warranties

                            Overspending At Christmas   6 Warranty

For almost everything we buy now - from watches to hairdryers - there’s almost always the option to buy an extended warranty.

It’s a good idea to take out extra insurance on super expensive items. But most times an extended warranty will only set you back financially and you’ll rarely need to use it.

How to avoid it:

Remember that most products come with a two, three or five year warranty anyway, and even if not, you have a 30 day grace period in which to return any faulty product, in line with consumer rights.

7. Faster Delivery Times

                              Overspending At Christmas   7 Fast Delivery

We’ve all been in that position where we’ve edged too close to Christmas and had to pay for speedy delivery to get our presents on time.

But Amazon same day and next day delivery rates can get as high as £6.99, and Royal Mail will also charge more for faster delivery times.

How to avoid it:

Shop in store to avoid delivery costs, or simply don’t leave it later than 18th December to order gifts online.

8. Buying on a store or Credit Card

                            Overspending At Christmas   8 Credit Card

It’s all too easy to whip out credit or store cards when shopping. It’s quicker, it’s easier, and it can potentially mean we can spread the cost of the item.

But by using plastic over real cash, we’re actually desensitising ourselves to how much we’re really spending. This can lead to us spending more than we meant to, or getting a shock come January when the bills come in.

Credit cards and store cards can also have humongous interest rates and fees (store cards being the worst of all), so they’re always best avoided if you want to keep total costs down.

How to avoid it:

Withdraw cash before you go shopping, or pay with a debit card and keep a tally of how much you spend and when.

9. Distracting Stimuli

                        Overspending at Christmas 9 - Distracted

It’s been proven that shops and high streets purposely use distracting stimuli to get us to spend more, and it works.

Christmas lights, Christmas music, bright baubles and impressive Santa sleigh scenes...it’s all intended to help us feel the festive magic.

As a result, we let down our guard, and are all the more likely to splurge on that expensive Karen Millen handbag and the matching purse.

How to avoid it:

There’s not really much you can do about this one (apart from shop online). But by simply being more aware, you can think through your shopping choices more thoroughly this season. Don’t let the tinsel go to your head...

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