Do You Need to Switch for Christmas? |

Do You Need to Switch for Christmas?

It’s that time of the year again. Seeing friends and family, good food and festive cheer and… debt? While we all strive to create the perfect day, millions of us will be relying on our credit cards to fund Christmas this year. 

Big spenders

Our latest research found that Brits who celebrate Christmas expect to spend £640 on average over the festive season. Over a fifth (22%) expect that they’ll pay for most of their outgoings with a credit card, suggesting that we could end up taking on a net debt of £6.4 billion nationwide this season¹.

Big spenders

Turn up the heat

As well as the usual culprits such as presents and food, the cost of energy is of particular concern to households this Christmas. With more energy used on TVs and gadgets, cooking, Christmas lights and central heating, four in ten of us celebrating Christmas (39%) imagine that our energy bill post-Christmas will be more expensive than the one before Christmas, with an expected increase of nearly £55. This equates to £960 million additional spend on energy nationwide – ouch.

In fact, fixed energy tariffs have risen by £100 on average over the last month², which means many of us could be in for a post-Christmas bill shock. This won’t come as good news to the 42% who said they would be concerned about the impact an energy bill hike would have on their household finances. And with the UK set to have the coldest winter in six years, we’re going to need the heating on!

Despite the potentially freezing conditions, we found that a quarter of people intend to ration their energy usage over Christmas to try and keep energy bills low. But remember there are other ways for you to save money, and if you’ve got young children or elderly relatives, make sure they stay warm.

 festive season

Knee-deep in debt?

Our latest findings echo the Bank of England’s recent warning that British households are taking on the highest levels of debt in over a decade, with over £190 billion owed on credit cards, personal loans and overdrafts – 11% more than a year ago³. 

Around 27% of respondents took on debt last year to pay for Christmas expenses and of those, over a fifth (21%) have yet to pay this off in full. And it seems this increase in consumer credit could be set to continue; over a third (35%) expect Christmas to be more expensive this year compared to twelve months ago.

No one wants to start getting ready for Christmas by trying to pay off the last one. Luckily our research showed that some families are taking measures to keep costs as low as possible this Christmas. Over a third (34%) plan to redeem reward and loyalty points to cut their costs, nearly one in ten have planned ahead and bought presents from the Black Friday or Cyber Monday sales, and a fifth have drawn up a Christmas budget (just make sure you stick to it!).

And there’s more you can do, here are our top tips for saving money this Christmas.


Top five tips for a cost-effective Christmas

  • Switching annual car and home insurance saves a family an average of more than £410 a year*, and it might be worth knowing that the UK's cheapest available energy tariff is around £788** per year5. 
  • It’s a good idea to monitor energy usage‎ carefully to ensure you're being as efficient as possible (using devices like Loop can help you)
  • Turn off any devices you aren’t using. TVs, radios and others use energy even when on standby so make sure they’re unplugged (see more of our energy saving tips here).
  • Put your Christmas tree lights on a timer so they turn on when it grows dark and off when you go to bed. You could also invest in fibre-optic lights which are far more energy efficient.
  • Make sure your finances offer you decent benefits; some credit card providers offer 0% interest credit cards for up to 48 months (administration fees apply).
*50% of people could achieve a quote of £136.34 per year for their buildings and contents home insurance based on Compare the Market data in May 2018. Based on Online independent research by Consumer Intelligence during May 2018 50% of customers could save up to £274.51 on their car insurance
**Based on OFGEM Bills, prices and profits data at May 2018. Switching savings are based on a customer with typical domestic consumption moving from an average available variable tariff with one of the six large suppliers, to the cheapest available dual fuel tariff in the market.   
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Peter Earl

Head of Energy

“With the stress of present buying, many people forget that energy can be a significant cost at Christmas. Whether you’re turning up the thermostat or plugging in the latest electronic gadget, energy use can rise quickly. There are lots of ways to be energy efficient at Christmas, such as using smart meters to monitor usage or turning off devices that aren’t in use. Changing energy provider can save households on average £327 a year, but our research shows that only 6% of people plan to switch or have recently switched to save money this Christmas.”

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So don’t get left out in the cold trying to save money this Christmas. Start comparing energy tariffs now and see how much you could save.

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