Woman in white sweater is writing a list while drinking from a mug. There's a Christmas tree, candles and twinkly fairy lights in the background.

6 things to budget for this Christmas

author: Helen Fox

By Helen Fox

When it comes to budgeting for Christmas, the earlier you start planning, the better. 

Planning early gives you more time to save up or spend as you go to spread the cost. But it’s never too late to set a Christmas budget and plan your spending. 

We’re going over the key things to budget for this Christmas and sharing our tips to make your money go as far as possible. 

What should your Christmas budget include? 

Your Christmas spending can be broken down into these six categories in your budget: 

1. Gifts  

Gifts account for about half of the average person’s Christmas spending. Budgeting for them could be as simple as writing down the total you have to spend. Or, you could go further and include individual budgets for each person you need to buy a gift for. 

2. Groceries  

The Christmas food shop is the second most expensive part of the holiday season after gifts. In 2022, the average estimated cost of Christmas food and drink was £100 per person. So, make sure you allow plenty of room for all the festive food and drinks you might need in your Christmas budget.  

3. Travel and accommodation  

Many of us take to the roads, rails or even the skies at Christmas to pay a festive visit to friends and family. So, make sure you budget for the cost of transport, whether that’s train tickets, extra fuel or even plane tickets, as well as accommodation you might need.  

4. Decorations 

Perhaps you like to have a real tree every year. Or maybe you simply need to replace any broken baubles and tatty tinsel when you get your decorations out. Either way, it’s a good idea to carve out some space in your budget for decorations. If you don’t need it, you can spend it on extra Quality Streets roll it over to next year.  

5. Socialising 

The holiday season is party season for many. This might come with food and drinks to pay for, taxis or parking, and even new clothes. All this needs to be included in your budget. Many venues operate set menus at Christmas, which can make it easier to plan what you’ll need to pay for. 

6. Entertainment and activities 

From festive light trails and Christmas markets to a good old-fashioned pantomime, there are all sorts of fabulous activities you might be planning to enjoy this year. But these events are rarely free. So, be sure to include the cost of your activities and entertainment in your budget. 

Our tips to make your money go further this Christmas 

  • Make lists for everything. From the gifts you need to buy to ingredients for Christmas dinner, making shopping lists will help you avoid impulse purchases and keep your spending on track. 
  • Try new traditions to save. Ideas like Secret Santa can help you spend less on gifts. Or, if you’re hosting this year, asking everyone to contribute a dish or item towards the meal can mean everyone spends a little on Christmas food, but not as much as if they were footing the whole bill. 
  • Use Black Friday sales to save on gifts. All sorts of retailers join in with Black Friday, so whatever gifts you’re hoping to buy, chances are you’ll find them on sale!  
  • Use supermarket Christmas saver schemes to save on groceries. These schemes allow you to save towards your Christmas food shop year-round and top up your savings with a bonus amount. Most supermarkets’ bonus month is November, and as long as you join and pay into the scheme before their cutoff date, you can get the free bonus money towards your festive groceries! 
  • Buy tickets in advance. Whether for travel or for entertainment and attractions, tickets are often cheaper the further in advance you book. Take advantage of early bird deals and advance tickets to avoid paying higher prices nearer the time. 
  • Try popular tricks to travel cheaply. If you’re driving, you can find the cheapest petrol stations on your route using a website like PetrolPrices to help keep costs down. Or, if you’re travelling by train, investigate split ticketing when booking your tickets to see if it could help you save. 
  • Do essential car maintenance before you travel. Checking your tyre pressure and tread depth, oil, coolant and brake fluid, among other things, can help you nip any problems in the bud and avoid recovery and emergency repair costs. 
  • Choose less popular (but still great) options. When something is in high demand, it may become more expensive. But other options that are still great choices can be much cheaper. For example, you might be able to get more beef for your buck than you would turkey. Or, you may be able to travel more cheaply if you avoid 23rd and 24th December. Most people travel on these dates, so tickets are in higher demand. 
  • Do it yourself. There are all sorts of ways that doing a bit more yourself can save you money at Christmas. Perhaps you’ll take on the challenge of cooking Christmas dinner from scratch instead of buying prepared food. Or maybe you could get crafty making your own gifts and decorations.  


https://yougov.co.uk/society/articles/44768-how-much-are-people-spending-christmas-2022 sourced 26th October 2023 

https://www.bbc.co.uk/news/business-63809484 sourced 1st November 2023 

https://www.bankofengland.co.uk/explainers/how-much-do-we-spend-at-christmas sourced 1st November 2023 

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.

Woman in white sweater is writing a list while drinking from a mug. There's a Christmas tree, candles and twinkly fairy lights in the background. Woman in white sweater is writing a list while drinking from a mug. There's a Christmas tree, candles and twinkly fairy lights in the background.