Boost your Christmas spending money

With just two pay days left until Christmas, MoneySuperMarket reveals the top ways consumers can expand their Christmas spending budget at no extra cost.

For early bird Christmas shoppers, M&S Bank will give each new current account customer a £125 gift card to spend in store if they apply through MoneySuperMarket. Furthermore, unlike many others, the account does not require any minimum funding per month.

For those who don’t want to be restricted as to where they spend their cashback, both Halifax and First Direct offer £100 to switchers, although account holders must deposit £750 or £1,000 respectively each month. Halifax’s Reward Current Account will also credit customers with £5 per month – a total earning of £160 in a year.

The run up to Christmas is the time of the year when spending is highest for many households. To cushion that blow, it is possible to earn while you spend, by using a cashback credit card. American Express’ Platinum Cashback Card gives a whopping five per cent cashback (£5 back per £100 spent) on up to £2,500 of purchases in the first three months, and 1.25 per cent cashback on all purchases thereafter. In addition, big spenders who tot up over £10k throughout the year will receive 2.5 per cent cashback on their account anniversary. Regular commuters would benefit from Santander’s 123 credit card, which gives three per cent cashback on fuel, National Rail and Transport for London spend of up to £300 per month, as well as cashback on department store spend and supermarket spend of two per cent and one per cent respectively.

If you need to borrow to buy a ‘big ticket’ item, consider choosing a purchase card with a lengthy zero per cent interest free period instead. This allows you to spread the cost of that spending. For example, Halifax’s Purchase Credit Card offers zero per cent for as long as 20 months.

Kevin Mountford, head of banking at MoneySuperMarket, said: “Although it may feel as though summer has only just ended, many consumers will be looking ahead and planning their spend over the festive period. With just two paydays left for many, consumers should be savvy and play the market by opting for one of the best deals available.

“When it comes to credit cards, it is especially important to work out how you will use it, as this will determine which type you should choose. If you can afford to clear the balance at the end of every month, a cashback card will reward you each time you spend. On the other hand, if you want to buy an expensive item but can’t pay the balance back in full, it is better to opt for a card with a long interest free period - bearing in mind that you will need to pay the balance back before the zero per cent period ends to avoid paying interest.

“Finally, if you don’t need to borrow money, then it’s well worth assessing your current account to see if you can switch to a better deal. Switching is simpler than ever and now takes just seven days. If you can earn over £100 just by doing so, then it’s certainly worth considering in the run up to Christmas.”