British families are preparing for an expensive festive period this year and contribute to skyrocketing debt costs, with research showing the typical household will fork out £787 for Christmas celebrations.
This represents an increase of £87 compared to 2024's spending, according to a Censuswide study commissioned by banking app thinkmoney.
Although consumers are shelling out more money, numerous households believe they're receiving diminished value for their expenditure.
The financial strain has become so severe that nearly one-third of Britons would choose to scrap or postpone the holiday season if given the option.
Households are preparing for a Christmas ''debt timebomb'
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The burden falls particularly heavily on those aged between 35 and 44, who anticipate spending an average of £1,115 on festivities.
Among this age group, 37 per cent express a desire to abandon Christmas entirely if possible.
The research indicates that financial pressures are creating unprecedented levels of holiday reluctance across Britain.
Middle-aged households face the steepest costs, juggling expenses for both children and extended family whilst managing mortgage payments and everyday bills.
Debt has becoming a major issue for households amid the cost of living crisis | GETTYConsumer expert Vix Leyton from thinkmoney warned: "This is shaping up to be one of the tightest Christmases in recent memory, and unfortunately for Brits, the rising cost doesn't mean more trimmings.
"Despite spending more, families are unfortunately finding their money has never been worth less - with the cost-of-living putting pressure on already limited budgets."
Beyond regular income and savings, a quarter of shoppers will rely on credit cards to finance their celebrations.
Buy Now Pay Later services will be utilised by 14 per cent of consumers, while seven per cent plan to borrow from relatives or friends.
The allure of deferred payment options is particularly strong, with 47 per cent of respondents finding BNPL schemes appealing for managing Christmas expenses.
This figure soars to 73 per cent amongst those aged 25 to 34. Only 22 per cent of shoppers anticipate settling their festive debts by December's end, while 21 per cent will continue payments through January.
Concerningly, 18 per cent predict their Christmas debt will persist into spring or summer. A small minority of three per ecnt acknowledge they might still be repaying this year's celebrations as late as August 2026 or later.
The financial squeeze is forcing widespread lifestyle adjustments, with 35 per cent of Britons planning to reduce spending on social outings. Gift budgets for adults will be trimmed by 31 per cent of households, while 27 per cent intend to economise on festive decorations.
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Households are preparing to budget for Christmas
| GETTYEven essential items face cuts, as 18 per cent plan to reduce their Christmas dinner shopping bills and 15 per cent will limit heating and energy usage. Despite 26 per cent of consumers beginning their festive financial planning by September or earlier, these cutbacks remain unavoidable for many.
Ms Leyton cautioned: "Worryingly, Buy Now Pay Later is set to play a big role, which risks turning festive fun into a debt timebomb that will echo well into 2026."
She emphasised that Christmas should focus on "celebrating with the people you love, not how much you spend."To combat these financial pressures, experts recommend creating comprehensive gift lists with individual budgets for each recipient.
Strategic shopping throughout autumn helps distribute costs across multiple paydays. Savvy consumers should prepare for major retail events, with Amazon's Prime Big Deal Days running 7-8 October and Sainsbury's toy sale beginning 22 October.
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