AXA - Be Life Confident

• 1 in 5 Brits suffer from stress related to Christmas spending and debt
• Brits are most generous at Christmas compared to European neighbours and 2nd only to Americans
• 88% of us will buy presents this Christmas, spending an average of £600 each
• 25% of adults use loans and credit cards to pay for Christmas
• Agonising over buying presents causes 40% of us to feel stressed

More than 10 million Britons (22%) are stressed and worried about the cost of Christmas and New Year according to research¹ from AXA. As part of its ground breaking financial social experiment - AXA Avenue - this new study shows that arguably we put ourselves under pressure because as a nation we are one of the most generous. However to pay for this generosity, this Christmas, up to 25% of the adult population could take out a loan or use credit cards for Christmas-related expenses. And four million people admit to previously funding Christmas on credit. Despite this, coming up with present ideas is the biggest Christmas worry for 40% of Brits.

According to a global study² from AXA, far from economising on presents, one in four working people in the UK plan to spend more on presents than they did for Christmas 2004, and over half say that they will spend the same (53%). This year 88% of working Brits will spend an average £600 on presents - this is considerably more than our European neighbours in Spain, Italy, Germany and Belgium - and more than the Canadians, Australians and Japanese.

Global Gift Generosity Guide

Which countries will be the most generous when it comes to buying Christmas presents?

People in the UK tend to buy the most presents relating to alcohol (78%), clothes (88%), confectionary (84%), books, DVDs and CDs (95%) and household (44%) when compared to the other countries in the above grid. Americans tend to purchase the most sports and audio video equipment as gifts.

This generosity does lead to a great number of us feeling worried and anxious after Christmas. Of those who worry about how much they spend during Christmas and New Year 27% are women and half of 16 to 34 year olds.

Kay Doherty, AXA Avenue participant commented "Christmas is one of the most financially stressful times of the year. I've made mistakes in the past and do now try to plan ahead for extra expense. It's difficult not to rely on credit to pay for gifts and the extra food, drink and entertainment, but it's something I aim to achieve every year.

"I am probably more generous at Christmas time than I should be but that's not something I want to change. Saran Allott-Davey is helping me to plan my finances so that Christmas, holidays and other expensive times of year are not a strain to me or my purse-strings. I'm learning that I don't have to go without - or be less generous - I just need to think and plan ahead a little more."

AXA's research indicates that Christmas spending and debt is causing 22% of people to suffer from stress around this time of year. Of those that said they suffered stress, women suffer more than men with 57.8% (5.9m) women admitting to suffering from stress at Christmas because of the cost, compared with 42.2% (4.3m) men. But even higher still, of this group, a whopping 70% (7.16m) of the under 45's say that they feel stressed at Christmas time.

UK regional breakdown of research findings:

So why are such large numbers of us worrying, feeling stressed and getting into debt around Christmas time?

Pat Brady, AXA, says: "At this time of year the shops are overflowing with some great tempting offers and having children especially can make it hard to say no or know where to draw the line when it comes to expenditure. That's why it is often so tempting to give in to offers of store credit, take out a personal loan or use an overdraft facility. And with pre-Christmas debit and credit card spending set to top last year's record £27 billion, it pays to plan carefully and avoid stretching finances to the limit."

CHRISTMAS MONEY DO'S AND DON'TS - TOP 10 CHRISTMAS BUDGETING TIPS
By Saran Allot-Davey, IFA of the Year and AXA Avenue¹ advisor

1. Plan 1 - List your monthly income and expenditure, if your expenditure is more than income there are only two things you can do (ideally you do both) - reduce expenditure and increase income. Tot up debt that is outstanding on credit cards, personal loans and bank overdrafts and try to shift all debt to interest free or low interest credit card.
2. Plan 2 - Budget what you can afford to spend at Christmas. If nothing or very little then you need to accept this and not just run up more debt. Buy affordable presents!
3. Plan 3 - Talk to friends and family about presents; consider agreeing to set a budget of say £5 per present.
4. Plan 4 - Think about giving your time or skills rather than buying a present. Teach yourself a skill; reflexology, Indian head massage, or massage etc from a library book and give out gift vouchers for an hour of your time.
5. Plan 5 - Take cash only when shopping - do not take credit cards or store cards!
6. Plan 6 - Shop around and prepare lists of what to buy for whom with a strict budget.
7. Plan 7 - Avoid the last minute panic. Apart from if you are buying clothes as presents many shops mark down their clothes in the last few shopping days before Christmas.
8. Plan 8 - Investigate good value discount stores and charity shops and take time to hunt for bargains.
9. Plan 9 - Consider home made presents - again the library will have books full of great ideas.
10. Plan 10 - A thought for next year, join a Christmas Club or put some money away each week, even if it's a small amount, e.g. £5.00 per week over 40 weeks is £200.00!