Rudolphs Nose & Your Bank Balance
Every year we all decide we’ll be better organised and start the Christmas shopping in March and just pick up a few bits here and there each month. After all, there’s an array of other expenditure to think about come December including a new party frock and an endless supply of funds for ‘Festive Beverages’. I mean, Christmas just wouldn’t be the same without a small sherry amongst friends.
According to Credit Action Charity, Britons spend on average £655 on food, drink, gifts & socialising which increases to £856 if you include cards, a new tree and all those late night, or should that be early morning taxis! Personally I could spend £856 on taxi’s and booze alone if I wasn’t careful but I fear this is more through a lack of self control than anything else.
A vast number of us pay for some part of Christmas using a flexible friend or a bank overdraft etc and like mixing your drinks on a night out, it’s always a good idea at the time!! They don’t call it the January Blues for nothing. As soon as the credit card statements are issued, the casual “I’ll worry about it at the time” approach quickly diminishes and deep dread sets in.
All is not lost!
There is light at the end of the tunnel as long as you are prepared to be realistic about how much you actually spend on a monthly basis and be strict with sticking to a budget. You can then pay off last years splurge without too much heartache although you may have to give us shopping in ‘Markies’ for a while!
Firstly, write down all your necessary expenditure (1) mortgage/rent (2) gas/electric (3) council tax (4) travel/petrol etc
Then make allowances for food/household, hair cuts, a monthly clothing allowance etc. CCCS issue expenditure guidance for all usual expenses therefore it’s a good idea to use this a guide and remember, it’s a guide not a target so if you don’t spend £50 per month on your telephone and you don’t have internet then don’t put down £50.
Once you’ve worked out your surplus monthly income, which can be paid towards your debts, contact your creditors with a view of setting up a repayment plan. Consider paying these off on a pro rata basis, so if you owe Bank of Mum £700 and Bank of Dad £300 and you have £200 per month surplus, propose to pay Bank of Mum £130 per month and Bank of Das £70? This is a great way of paying off what you owe and remember minimum payments will probably mean, all your settling is the interest each month.
This tactic is a great idea if you only have ‘Christmas debt’ to repay however if you find yourself with larger debts, perhaps a Debt Payment Programme via the Debt Arrangement Scheme will suit your needs better. Unlike the above approach, DAS stops all interest and charges and protects you from creditor diligence while giving you up to 10 years to repay your debts in full. Seeking help to deal with debt will ensure Rudolph’s nose is the only thing in the red come January!