Man online shopping with a Christmas jumper on

7 ways to protect your credit score this Christmas

author: Adele Kitchen

By Adele Kitchen


Getting carried away with festive spending can mean your credit score takes a knock, which can last for months or even years to come.

According to the Bank of England, a typical UK household spends over £700 more in December than in any other month. But it’s possible to spend wisely and enjoy Christmas with friends and family without putting yourself into debt and harming your credit score. 

 Here are seven ways you can take care of your credit score over the festive season: 

1. Be mindful of overspending 

We all enjoy spoiling our loved ones at Christmas, but overspend and you could be feeling the knock-on effects long after the festive season has passed. The easiest way to avoid overspending is to sit down before you start your Christmas shopping and work out a budget that you will stick to. Decide how much you can afford to spend and break it down per person. Don’t forget to include festive food, drink, and anything else you might need, like decorations. 

2. Plan ahead 

Leaving everything to the last minute results in panic buying, which is a common way to blow your carefully thought-out budget, as well as your credit cards. Planning gifts you want to buy in advance will give you time to shop around for the best price. Advance planning also gives you a chance to save some extra money - meaning having to rely less on credit. 

3. Make a list (and check it twice) 

Shops competing for your business will try every trick in the book to get you to spend with them. From offering 'buy now, pay later' schemes, to pushing attractive discounts and incentives. Although some offers can seem appealing, try not to impulse buy or sign up to credit without thinking about it, as you could end up with things you didn’t really need and spending more than you wanted to. Making a list before you go shopping will help you only buy what you really want or need.

Read on for tactics for dealing with impulsive spending.

4. Be mindful of your credit usage 

Consider using credit such as cards and overdrafts carefully. Although these options can help make Christmas more manageable, you’ll still have to pay back what you owe eventually, and usually with added interest. 

Before using existing cards, arranging an overdraft, or signing up for a new store card, be sure you can afford the repayments and don’t exceed your credit limit. If you run up debt you can’t repay, your credit score will be damaged and this will affect your ability to get credit in the future.  

Always keep an eye on your credit utilisation and remember that if you apply for a new line of credit, a hard search will be performed on your credit file. 

5. Make a pact with friends and family 

If you’re feeling the pinch this Christmas then sit down with your loved ones and agree to do things differently this year. It might be a good idea to set a spending limit of £10 or £20 per person or decide that only the kids will receive gifts this year. Or how about banning gifts entirely and suggesting that everyone contributes to a meal together instead? Taking the pressure off like this will stop you from spending money you can’t afford, and you might find they’re just as relieved to have the pressure taken off them as well. 

6. Don’t forget your regular outgoings 

Amid the excitement of the festive season, it’s easy to forget the mundane day-to-day bills that still need paying. Missing payments or even paying them late will have a negative impact on your credit score. And if one too many missed payments results in a default, it’ll stay on your credit record for six years. Make sure you remember your existing commitments by setting up direct debits. This way, they’ll get paid automatically. Or you could write notes in a calendar to remind you when bills are due. 

7. If it sounds too good to be true - it probably is 

You might think you’re good at spotting scams, but fraudsters are always inventing new ways to part you with your money. There’s usually an increase in scams around Christmas that try to take advantage of your festive spirit and catch you off guard while you’re busy doing other things.

Remember to pay extra attention when putting your card details into websites. Stick to well-known and trusted sites where possible, and check that the address bar looks like it should. Don’t click on any emails or text messages that look suspicious, and if you receive an offer that sounds too good to be true - remember that it probably is. 

Read on to find out how to spot a scam.

Disclaimer: We make every effort to ensure that content is correct at the time of publication. Please note that information published on this website does not constitute financial advice, and we aren’t responsible for the content of any external sites.

Man online shopping with a Christmas jumper on Man online shopping with a Christmas jumper on