Citizens Advice has issued 10 tips to avoid the annual Holiday debt hangover as it revealed that an estimated 10 million Britons across England and Wales are faced with recession problems.
Last quarter figure has shown a significant increase in the number of Britons seeking financial advice on mortgages, secured loan arrears and fuel debt. Citizens Advice said the figure was up by 28% and 38% respectively in July and September compared with the same months last year.
The group advice the public to avoid starting the New Year with a debt hangover and go easy on spending during the Holidays.
The top 10 money tips to avoid hangover:
Plan early for Christmas
Plan your spending according to your budget. Prepare a budget to each individual on your Christmas list and stick to it. Be realistic of what you can afford to give. Don’t’ go overboard.
Don’t forget the everyday bills
Although Christmas comes only once a year, the regular bills are around all-year-round, like rent, mortgage, utility bills, food and other expenses. These expenses have to be paid on time unless you want them to pile up. Set your priorities right even though its Christmas.
Don’t bank on an overdraft
If you are low on budget and need extra cash, avoid running up an overdraft without consulting your bank. This can be more costly in the end.
More often, it is cheaper to buy with cash, cheque or debit card instead of using your credit cards where you have to pay interest. Use your credit cards only on discounted items wherever possible.
It always pay to check as many shopping areas as possible to find the best special offers. Buy only things you want and not what people say you should have. It is not always wise to bank on items with long warranties, most of the times, the cost of repair is less than the cost of the warranty.
Be safe, buy safe
As a rule, it is not wise to buy counterfeit. Do not buy from unauthorized dealers and do not borrow from unauthorized lenders. The savings presented on the onset may have strings attached and just be a false economy.
Read the fine print
Always read the fine print of any credit agreement. Compute the total amount to be paid and ensure you can afford the monthly instalments. Although some credit cards offer interest-free purchases, missing one payment can cost you a lot more.
Manage your own credit balance
If you are looking for a credit card, go for the one with the lowest interest rate. But you have to be intelligent as some cards may charge high interest rates, but they also provide interest free periods or discounts. Calendar in your diary the dates for payments of any purchases made on credit cards.
Christmas should always be full of happy memories. And this includes remembering paying for the money you borrowed. Keep in mind that paying on time means less interest and missing on payment translates to additional charges.
Plan and save for next Christmas
What better way to plan for next Christmas than the day after the last Christmas? Learn from your mistakes and how to better plan the next Christmas and start saving to make your plan realisable.