Let’s avoid the Christmas debt trap

James Bond
5 min readMar 21, 2021
Couple stressing over finances

I write this article on 21st March 2021- the day of the UK census. In about two weeks the UK will enter the 2021–22 financial year which starts from 6th April. The calendar year starts on 1st January.

However for some it makes no difference and they are still paying off Christmas. Let me tell you now how to help avoid the Christmas Debt trap.

What is the Christmas debt trap?

I can hear you all asking that question.

Between 30th November — 2nd January every year people spend a fortune at Christmas. There are huge winter fuel bills to pay due to the cold weather. They are presents to buy for friends and loved ones. There is the Christmas dinner to buy and cook. There are Christmas parties to go to. Often people spend money they don’t have putting a fortune on credit. It’s only when 2nd January comes people realise just how much money they’ve spent. Then they are desperate for payday at the end of the month.

The indebted end up paying it off for months until summer to September and then it starts all over again. It’s can be compounded by the summer holiday debt trap.

In many shops in the UK during January there are often more staff than customers.

Spare a thought for the self employed

If you are self employed in the UK it’s worse. The tax year runs from 6th April to 5th April and so you’ve then got until 31st January the following year to pay your taxes. January is a terrible time for you for a few reasons.

You’ve spent all your money at Christmas.

You have no customers coming in during January.

At the end of the month you have to pay all your staff.

At the end of the month you have to pay your taxes.

If you’ve hired a bookkeeper or accountant you’ve got to pay them as well.

From a fitness point of view more weight is put on during December than the rest of the year put together.

Why is a fitness trainer talking of this?

The number one cause of obesity is poverty (1).

What you need to do.

Avoid high winter bills

Pre-pay your food shopping.

Put money aside for gifts.

Learn financial education.

Get another stream of income.

So what do you do?

Avoid high winter bills

Unless you live in a tropical country you’ll know what November to February can be a very cold time. People can often put their heating up higher in winter. This leads to higher winter bills.

Now in another article I will talk of method to reduce your fuel bills but for now all I want you to do is phone up your gas and electricity supplier and ask for a budget plan. I don’t care if you are a millionaire please ask for a budget plan.

A budget plan is a plan where they estimate 12 months usage and take a fixed sum every month for 12 months. At the end if you have used too much they either ask you for a payment or they adjust your monthly payment. If you’ve used too little they’ll either give you a refund or adjust your payments. In summer you’ll be using a lot less energy because you won’t be heating your house as much and theoretically you’ll be drying your clothes outside.

This can save a lot of stress.

Pre-pay your food shopping

In the UK many of the big chain supermarkets do christmas saving stamps schemes. Again I don’t care if you are a millionaire but it’s a good idea that every time you go shopping you buy £10 worth. My supermarket- the Co-op — gives £2 of free shopping for every £48 worth of stamps you buy so long as you redeem your stamps in December. It works out at 4% interest. Last year I saved £300 worth and it put a huge dent in my christmas shopping bills.

Get started with your supermarket shopping scheme as soon as you can.

I will of course do an article on sensible food shopping at a later date.

Put money aside for gifts

In the UK we have several Christmas shopping schemes. I use Park Hampers however there are quite a few similar programmes. You can pay a fixed amount every week to pre-pay your christmas, you can either do this via a representative of theirs or you can do a bank transfer or pay by standing order or by a post office.

You could put the money into a bank account and I used to do that. The reason I stopped is because it’s too tempting to dig into that money.

Learning financial education and another stream of income.

I cannot recommend enough that you read the legendary book Rich Dad Poor Dad by Robert Kiyosaki and the books from that series. However a brilliant way to learn financial education is to find a good network marketing company and join it. Work the system and get yourself another source of income. For many families in the UK another £1000 a month is life changing.

However there is another benefit.

Many of them have excellent educational training programmes.

If you are self employed

I’ll cover this in another article but for now what I want you to do is find a bookkeeper- your accountant will know of one. Once a month give your bookkeeper all your bank statements, all your receipts for that month and your travel log. She (most bookkeepers are women) will create a nice spreadsheet for your accountant to make the tax return easier and tell you roughly how much tax to put aside. By April your accountant will have 8 months to do your tax return.

If you do all the above then you’ll go a long way to avoid the Christmas debt trap with all the poverty and hardship that comes with it.


  1. The number one cause of obesity http://www.jamesbondhealthandfitness.co.uk/the-number-one-cause-of-obesity