UK markets close in 5 hours 52 minutes
  • FTSE 100

    -6.30 (-0.08%)
  • FTSE 250

    +15.44 (+0.07%)
  • AIM

    -0.51 (-0.06%)

    -0.0006 (-0.05%)

    -0.0001 (-0.01%)
  • Bitcoin GBP

    +1,832.95 (+3.94%)
  • CMC Crypto 200

    +35.72 (+2.82%)
  • S&P 500

    +30.81 (+0.55%)
  • DOW

    +247.10 (+0.62%)

    +0.20 (+0.24%)

    -6.20 (-0.26%)
  • NIKKEI 225

    -1,033.32 (-2.45%)

    -277.44 (-1.52%)
  • DAX

    -25.75 (-0.14%)
  • CAC 40

    -17.26 (-0.22%)

The true cost of Christmas revealed. And how to cut it

Santa and his Elf helpers are seen in a grotto during a Christmas photo-call at Hamleys toy store, in London, Britain, September 29, 2022.  REUTERS/Peter Nicholls
Santa and his elf helpers in a Christmas grotto at Hamleys toy store in London. Photo: Peter Nicholls/Reuters (Peter Nicholls / reuters)

For something that happens fairly predictably, Christmas has a knack of creeping up on us financially. We’re suddenly hit with the horrible challenge of finding hundreds of pounds from nowhere — or facing the ultimate threat of ruining Christmas.

Finding this sort of money is hard enough in a normal year, but this year, with any spare cash devoured by rising prices and runaway bills, it’s nigh-on impossible.

Each year Hargreaves Lansdown does a piece of research looking into the cost of Christmas, and it’s always horribly expensive.

On average, those who celebrate the day will spend an average of £576, with almost one-in-three parting with over £500 and one-in-eight forking out over £1,000. Men will splash the cash even more enthusiastically, with an average of £622.


Read more: 2022: Year in review

However, we’re taking steps to make life a bit cheaper this year. Two-in-five said they would cut their costs, and among women and the squeezed middle (aged 35-54) this rises to around half.

Young people, aged 18-34, are less concerned, and happier to keep spending. They fork out more than any other age group — an average of £633. Almost one in three say they’re planning to spend more than they did a year earlier.

There’s always the hope that this group includes plenty of those who are moving up the career ladder and have a bit more cash. However, there’s a risk that they’re prioritising the hunt for a perfect Christmas over their financial security, so they could come to regret it later.

CARDIFF, WALES - OCTOBER 21: A woman carrying a shopping bag walks past a Next store on October 21, 2022 in Cardiff, United Kingdom. The Office For National Statistics announced that September's retail sales volumes have fallen by 1.4% much more than expected as households cut back spending in the face of rising borrowing and energy costs. The mourning period following Queen Elizabeth II's death was also considered a factor. Meanwhile, public sector borrowing hit £20 billion in September, compared with the £17.1 billion forecast. (Photo by Matthew Horwood/Getty Images)
Two-in-five said they would cut their Christmas costs this year, according to research by Hargreaves Lansdown. Photo: Matthew Horwood/Getty (Matthew Horwood via Getty Images)

The research also looked into the ways people are planning to cut back this year and found a significant chunk of people have already honed their frugal festive habits over the years.

Around half (48%) always shop around for the best price on presents, while two-in-five buy food from discount supermarkets, and wait for sales and discounts before they fork out for presents.

Around a quarter of us have good years and bad years, and know the steps we’re prepared to take when we need to. Waiting for the sales is the most common approach (28%), followed by spending less on each present (25%) and buying cheaper food and drink (25%).

Meanwhile, some people are tightening their belt for the first time this year. Presents are most likely to get the chop, with a quarter spending less on each person, and one-in-five buying for fewer friends and family.

Read more: How to make the most of freebies without paying the price

We’re also cutting back on food and drink, with a quarter of us buying less of it and one-in-five buying cheaper items.

But there are some things we refuse to budge on. Half of us have never regifted an unwanted present, and say they never would.

Two-in-five said they couldn’t possibly ever consider having fewer guests on Christmas Day in order to keep the costs down, and almost a third ruled out the possibility of ever socialising less over the festive period. It seems the last few years have given us our fill of celebrating at home.

Christmas dinner with roasted turkey on the dining table. Family sitting around the dinner table and delicious food on Christmas eve.
Brits are cutting back on food and drink this Christmas, with a quarter of us buying less of it and one-in-five buying cheaper items. Photo: Getty (alvarez via Getty Images)

How to cut the cost of Christmas

If you’ve cut all the usual costs, and considered some of the changes you usually make in tougher times, there may still be some wiggle room to bring down your spending even further.

If you can’t face the thought of having fewer guests over for the big day, on top of trading down to cheaper food and drink, you could ask your family to bring something with them – whether that’s the pudding or the crackers.

Read more: UK’s cheapest supermarket revealed

If you’re among the quarter of people who have never considered buying fewer presents or spending less on each person, then it’s worth having a chat with your family to see whether they’d also welcome the chance just to buy for the kids, or to set a limit.

If you’re among the half of people who have never regifted anything, you’re missing a trick. If you arrange to meet up with friends after Christmas, you don’t even have to make a secret of it, you can arrange to pass on a gift each year – and then it’s up to you whether to regift the horrible, scented drawer liners from your Aunty Maud or that nice bottle of scotch from your dad.

Watch: How to prevent getting into debt