For many of us, December can be a tricky month to budget for, with the average UK household spending £800 more compared to any other month. Whether it’s the many relatives and friends you have to buy gifts for, the vast quantities of food and drink you need to stock the cupboards with, or the cost of heating your home – the festive period can make a serious dent in your wallet.

To help see you through, here’s a complete guide to maintaining a healthy relationship with your bank balance during the festive period:

1. First things first: set a budget 

It’s easy for us to impulse buy anywhere and everywhere. The internet knows what you like, and therefore will encourage you daily to spend money. Resist this urge. Cutting or pausing services that you are not currently using, such as a gym membership or online subscriptions, can also help free up funds. For a guide to budgeting, get started here.

2. Track your spending 

Seeing your finances on paper will help you to manage where you are with your spending habits and how you can budget properly throughout the month, without being caught short. It can be a daunting task to start processing a budget sheet, but it will definitely benefit your financial management.

Think about setting up direct debits for the date you’re paid to pay off debt. Even paying off £5 a month is a start, and if the money leaves your account on the day you’re paid, you’re less likely to feel the loss. Work out your monthly household incomes and outgoings, only by knowing exactly what is coming in and going out will you be able to budget effectively.

3. Work out your priorities 

While it can sometimes be tempting to pay the ones that shout the loudest first, the best way to prioritise is to consider what the end result of non-payment might be. For example, if your rent or mortgage payment remains unpaid, you could potentially lose your home. Likewise, the council has the power to use bailiffs, and the supplier of your gas and electricity can disconnect you. Therefore these items should be treated as essential and prioritised above other bills. Everyone’s lives are different and so what might be essential to you might not be essential for someone else. If you’re elderly or disabled, your ability to access the telephone can be a vital lifeline, while if you depend on your car to get to work, ensuring this is well maintained is likely to be a key priority for you.

4. Shop around for the best deals 

Are you sure that you’re paying the cheapest amount for goods and services you use? Consider shopping around for your utilities, car insurance, phone and broadband. Different providers can offer you cheaper deals and there are numerous price comparison websites you can use to find the best savings for you. You can also look at reducing the amount that you’re spending on travel. Book train tickets as far in advance as possible to ensure you’re not paying a premium, and you can also take the same approach when booking flights. The day and time of travel can also affect the price of your flight, with Wednesdays tending to offer the most savings while Saturdays are often the priciest. 

5. Take back control

It’s important to make a habit of looking over your finances. Try to pick a time each week where you have the opportunity and space to sit down and look at your money and bills. Look at the lists you made to keep track of your spending and see what you can manage without, and how you can make changes. 

Make sure to open your post and not put off reading any bills. While it can be a worrying prospect, it’s vital to tackle any potential issues early on before they become more of a problem.

CABA provides free lifelong support to past and present ICAEW members, ACA students, ICAEW staff, and their close family members. 

We have a range of services to support your financial resilience including benefits advice, legal information and UK debt management, find out more by contacting us today

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