Don't blow all the dough on Christmas

Christmas is fun but it can be phenomenally expensive. The office Christmas party, extra nights in the pub, presents for the family, and taxis home all take their toll on your wallet. Unless you budget, it is almost a given that you will spend a great deal more than you planned between now and January 2. In fact, most people start the year with a financial headache.

"We get 110% more calls in January than we do in December," says Helen Saxon of the Consumer Credit Counselling Service (CCCS), a debt advice service." Though you might have been tempted to use your credit card to manage that extra spending, you'll have to face the bills when they start dropping on the doormat in the new year. "We get similarly large volumes of calls in February and March as well, as the costs start to appear on credit card statements," she says.

All the expenses of the festive season can push you into serious debt problems. "Christmas tends to be the final straw for many people," she says. "Typically, the people who come to see us owe ?26,000 and are between 25 and 40."

Even if you're not struggling with debt, you'll probably spend more than ?800 this Christmas. According to research by Switch, we spend an average ?337 each on presents, ?100 on food and ?56 on drink, with the rest disappearing on Christmas cards, accessories and decorations.

So with the help of the CCCS, here is our ten-point plan for avoiding debt at Christmas:

1. Set a budget at the beginning of the month - and stick to it. It can be daunting to do a realistic forecast of what you might spend over the party season but it will be even more scary if you can't pay the bills in January. "Make a list of everything you will need and how much it will cost - this will help you to budget," says Helen Saxon.

2. Shop early - this will help spread the cost of Christmas. If you rush to the shops at closing time on Christmas Eve you are likely to spend a great deal more than if you had planned ahead.

3. If you must borrow, compare deals to make sure you get the lowest interest rate. If you need extra cash to tide you over the Christmas period make sure you consider all of the options: a credit card, a bank loan or an authorised overdraft. Look out for interest-free periods and compare rates available from credit card providers like Halifax and Virgin, which charge 0% interest on balance transfers for nine months. You can find the current best deals at Moneyfacts, the independent money advice site.

4. Don't go overdrawn without telling your bank in advance. You will be penalised quite heavily, often with an initial ?20 fine and then interest of as much as ?5 a day.

5. When you get your January or February credit card statement, try to pay off all the debt as quickly as possible. "If you restrict repayments to the minimum, you will find the costs of Christmas have escalated," says the CCCS.

6. If you do get into financial difficulties go to see a debt counsellor as soon as possible. The longer you leave the problem, the worse it will become. The CCCS advice line offers free debt advice on 0800 138 1111.

7. Christmas is a peak time for fraudsters. Keep an eye on your card when you hand it over to be swiped at a shop or in a restaurant and always check that the information on the sales voucher is correct before signing. If you are at a cash machine and someone behind you is behaving suspiciously or attempts to distract you in anyway, move to another machine. And beware of machines that may have been tampered with. If anything looks amiss, don't use that ATM.

8. Always check your statement to ensure that you can account for every transaction.

9. Don't go mad in the January sales if you have overspent at Christmas and avoid the temptation of the numerous 'buy now pay later' offers.

10. Beware of taking out a consolidation loan to pay off your debts - often these are secured against your house so if you miss payments your home could be at risk. It may be tempting to lump all your credit into a single monthly payment, but you will be tied in for up to 25 years and could end up paying double what you originally owed.

Finally, when you do get round to sorting out your finances after Christmas, don't make the mistake of thinking of your savings and debts as separate issues. "You should always pay off borrowings before you start to invest," says Patrick Connolly, research and investment manager at the financial adviser John Scott & Partners. "Most people won't earn nearly as much interest on their savings as they are paying on their debt, so it makes sense to use any spare money you have to clear your borrowings first."