I imagine that none of us fancy cutting costs at Christmas, so instead of striking people off your Christmas list, in my blog at compareandsave.com, I ‘ll show you how to slash your Christmas costs, and put Scrooge to bed.
With cash being tight as the dark cloud still looms over our UK economy, festive spending may be frugal. According to the HSBC Christmas Spending Survey, findings show that a shocking 37% of those surveyed will use all or some of their savings and 21% will borrow to pay for Christmas gifts.
Ideal Christmas cards
A prepaid card is an excellent alternative to a debit or credit card for your festive shopping trip because it allows you to manage your spending with limits. If you’re anything like me when I hit the shops, I go in with a well-intended plan and a realistic budget for my gifts, but I end up leaving loaded with shopping bags and a credit card bill as long as my arm.
As prepaid cards don’t have a credit facility, you can never spend more money than you have loaded onto the card. Although a debit card uses the money in your bank account, it makes sense that you may need this as a financial cushion for your household bills or you could end up going into your overdraft and into debt.
If the thought of being rejected at the checkout puts you off as much as it does me, look for a prepaid card with online account management so you always know exactly how much cash you have to splash.
Bank on a book
If you’re looking to buy without actually spending any cash, then you could opt to do your shopping using a catalogue. Popular catalogues such as Littlewoods, K&Co and Isme all offer interest free buy now pay later deals, so you don’t have to fret about the prospect of a final hefty bill.
Be careful if using this tactic though because if you don’t repay in full by the end of the interest free period, you’ll end up paying a high rate of interest on your purchases.
Although you might think that a ‘buy now-pay later’ deal is already pretty good, you could actually earn money by doing your Christmas shopping using a cashback credit card. By choosing a credit card with a good rate of cashback and bonuses for new customers or heavy, you could actually end up making a profit.
It’s advisable to only go for this option if you’re confident that you can repay the balance in full immediately, otherwise you could end up out of pocket because the heavy cost of the interest that’ll outweigh the rewards.
I’ve picked some of the top deals that are currently on the market, but you should always compare cashback credit cards rather than plumping for the first one you see.
Capital One’s Aspire World credit card offers 5% cashback (up to a maximum of £100) in the first 99 days, dropping to between 0.5% and 1.25% thereafter. This card may be ideal for your Christmas shopping spree as you can benefit from the higher rate of cashback in the promotional period.
Amex Platinum Everyday is a close runner up to the Capital One card. They both offer 5% for the first three month, but it loses out because of its £3,000 minimum spend, compared to the Aspire World, which has no minimum spend.
Lagging slightly behind in bronze medal position is the Barclaycard Cashback, which actually has a higher rate during the introductory period, up to 6% (up to £120 max). The snag is that it charges a £24 annual fee and you have to make at least 15 transactions each month – quite handy if you’re making a number of large purchases though.
One of my favourite ways to save cash all year round, but particularly at Christmas, is shopping online rather than in-store. I was pleasantly surprised at the savings I could make by ordering from the comfort of my four walls in my pyjamas.
Some retailers actually have cheaper prices for online customers so it’s possible to make savings without having to do anything. Start saving mega-bucks by using retail comparison tools and have yourself a very festive Christmas….
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|Jemma is a news & research reporter for compareandsave.com.Having worked as a journalist on a number of personal finance websites; she now spends time researching and commenting on UK personal finance stories and investigating new ways to help our readers save money.For press enquiries, please visit our Media Centre page.|