Thrifty Brits cut back this Christmas
As the second Christmas of the UK's deepest recession approaches, a study by Saga Platinum credit card reveals how the British public are budgeting for Christmas.
The research, based on figures and data from 1999 and 2009, reveals how today's consumers are reining in the cost of Christmas, with each adult planning to spend £435 on presents, compared to £516 back in 1999. However, taking inflation into account, the real value of the 1999 amount is equivalent to £666 in 2009 - so a massive 35 per cent drop. The over-50s remain a little more generous, reducing their Christmas present spend by just a quarter (25 per cent). Spending on family Christmas presents is set to fall - with children being affected most of all.
Responding to the current economic environment, many people are spending only what they can afford. This year half of the population (52 per cent) plan to use their regular income or salary to cover the costs of Christmas, and not dip into their savings or borrow. Ten years ago this prudent approach was taken by just a third (33 per cent).
Significantly fewer people say they will use their savings to pay for Christmas - from 31 per cent in November 1999 to just 13 per cent in November 2009. Clearly people feel the need to keep their savings in these uncertain times.
Those planning to pay for Christmas on credit cards has remained the same at 16 per cent. Over a quarter (28 per cent) will pay back the balance immediately or do so when they next get paid after Christmas.
However the over 50s are wiser when it comes to using credit cards with a third (32 per cent) of the 20 per cent that will be using their card to aid with Christmas purchases, intending to clear the balance immediately.
The Saga Platinum credit card offers a great deal for existing customers who borrow on the card, as there is a low rate of interest of just typical 11.9% APR (variable) and, unlike most UK credit cards, re-payments to the card are ordered fairly. This means that after interest and fees, the most expensive debt is cleared first.
Over 50s who take out a Saga Platinum Credit Card will enjoy nine month's interest free on purchases, covering the cost of Christmas and more.
For more information, visit saga.co.uk.