How to keep your Finances Festive, Not Frantic

As we are in the midst of all the Christmas fun, I thought it might be helpful to send some points on how you can stay merry without going broke, helping keep those festive finances in check. Although I will caveat this is certainly a case of a "do as I say, not as I do" for a few of these!

In the festive season it’s the time of year when your bank balance can disappear faster than the last selection box on Christmas Eve. Between Black Friday deals (that mysteriously turn into Cyber Monday) and the irresistible urge to buy all the things for everyone you’ve ever met, it’s no wonder January often arrives with a hefty side of a financial shock.

But fear not! Having fun during the holidays doesn’t have to mean going into the new year with buyer’s remorse and a hefty credit card bill. With a bit of foresight, planning, and a few laughs along the way, you can stay within your financial means, and most importantly, still feel festive.

The Temptation Trap: Why It’s So Easy to Overspend

Let’s be honest, retailers are basically Santa in disguise. They know your weakness for novelty socks, scented candles, and that snow globe shaped like a llama wearing a Santa hat. Black Friday and Cyber Monday hit, and suddenly your bank account looks like it ran a marathon without telling you.

And now it’s Christmas. Add in work nights out, secret Santa, friends’ festive brunches, and the annual cost of decorating your house like a gingerbread castle, it’s a recipe for overspending.

But here’s the good news, you’re not alone and there’s a better way.

Fun ≠ Financial Freefall

Budgeting doesn’t mean being a Grinch. It just means getting intentional with your money so you can enjoy the season and start the new year without a financial hangover.

Christmas = Cash

Here’s how to do it:

1. Make a Game Plan (with figures)

Grab a hot drink and write down:

• Gifts you need to buy

• Social plans (office party, family lunch, secret Santa)

• Travel (you may be driving more than usual or getting trains for days out)

• Decorations

• Festive food

Then assign a budget to each. Seeing the numbers in front of you makes it a lot easier to keep track than trying to remember in your head while scrolling online at 11pm.

2. Gift Strategically

Gift giving is lovely, but it doesn’t have to be a price war, here are some ideas to stay sane:

• Set a price cap for group gifts and stick to it

• Handmade wins hearts - cards, baked goods, framed photos? Priceless.

• For big ticket items, consider spreading the cost across months (enter: sink fund, more on that later!)

Blissfully ignoring your bank balance on a night out!

3. Festive Socialising Without the FOMO

Office party at the swankiest bar in town? A whole squad booking the poshest brunch? You don’t have to say no to everything, just choose wisely.

Pick the events you actually care about and decline the rest

• Suggest budget-friendly alternatives (cheese and wine at home is a better option than £15 cocktails)

• Set a spending limit before you go out

Sink Funds: Your Holiday Safety Net

But because nothing says “bah humbug” like being a scrounge on Christmas Eve drinks, let's plan ahead so you are well prepared. Let's talk about Sink Funds.

If you’ve found yourself struggling in January more often than not, let me introduce you to a financial power house, the sink fund.

A sink fund is a savings pot for predictable, non-monthly expenses. Instead of thinking “I’ll worry about that gift bill later,” you build the cost into your regular budget before the holiday arrives.

Here’s how it works:

1. Estimate how much you usually spend over the festive period

2. Divide that number by 12 (or however many months you choose)

3. Each month, park that amount into a separate savings pot

By the time December rolls around, you’ve already funded your festivities and avoided the dreaded January cash-flow crisis.

The best part of Christmas isn’t the price tag, it’s the memories, the laughter, and the feeling of warmth (even if that’s just from your third mug of mulled cider). With a bit of planning and a sink fund in place, you can enjoy all that without starting the new year in financial limbo.

So go ahead, be jolly - just not broke.