How to budget for the holiday season

Plan holiday spending around the bills that still need to be paid before your next income arrives. Put those amounts aside first, then decide what is available for gifts, travel, food and celebrations.

Protect the next month's budget

List ordinary living expenses and debt instalments from now until your next payday. Include school costs, transport and other expenses that can make January feel particularly long. Check the dates of debit orders if your December salary is paid earlier than usual.

Use a separate savings space or clearly labelled budget category for these bills. Money in your account is not all available for holiday spending.

Set one spending limit, then divide it

Write down the holiday amount you can afford without borrowing or missing required payments. Divide it between gifts, travel, extra food, entertainment and a small allowance for unexpected costs.

Holiday category	Your limit	Spent so far
Gifts and decorations	R	R
Travel and transport	R	R
Food and celebrations	R	R
Entertainment and other costs	R	R

Agree on gift limits with family before shopping. Homemade gifts, shared meals and free activities are options if they fit your plans. Check a larger purchase with the purchase affordability tool.

Give a bonus a job before spending it

If you receive a bonus, decide what it needs to cover. You might need it for ordinary bills, an emergency reserve or an extra debt payment as well as celebrations. Choose amounts that fit your circumstances rather than committing the entire bonus to one purpose.

Check the cost of paying later

A delayed first payment does not make a purchase free. Read the interest, fees, repayment dates and total amount payable. The payment holiday guide explains why postponing payments can increase the cost.

If you are under debt review, keep to your agreed plan and discuss an expected shortfall with your counsellor. Do not assume you can skip a payment to cover holiday costs.

If the budget is already short

Reduce optional spending before the money is committed. If income cannot cover essential costs and existing debt instalments, make a full household budget and ask for help with the figures. The debt counselling guide explains what an assessment should cover.