Many over-50s plan to spend more this Christmas

By UK CreditCards.com

Older Britons say they are willing to spend a little extra on a merry Christmas for their families despite the struggling economy, according to the latest research from Saga.

A poll conducted on behalf of the financial services provider suggests that many of those over the age of 50 will spend more on Christmas this year. However, half of them will turn to store or credit cards to fund their festive spending, highlighting the importance of choosing the most appropriate card.

24% plan to increase spending
Almost one in four (24%) adults over age 50 who took part in Saga's research said they intend to spend more this Christmas than they did in 2011. And those over the age of 75 are being particularly generous, with 31% of people in this age group saying the tough economic conditions will not prevent them from upping their festive spending. Christmas-shopping

"The over-50s' ability to manage their finances and plan ahead has left many in a position to be more generous at Christmas this year than last," said Roger Ramsden, chief executive of Saga Services, in a statement.

The average respondent will fork out £235 on presents for close family members, with children receiving gifts worth £70, spouses receiving gifts worth £71 and grandchildren in line for £59 worth of presents.

Many expect to overspend
How does the over-50 crowd afford this generosity? Many say they plan in advance for the festive season. One-third will use their savings this year, and one in 10 say they have a special account designated for Christmas spending.

Still, many over-50s will foot the bill for Christmas by overspending. More than a third (36%) of respondents confessed to buying more than they ought to, and 88% complained that the festive period has become too materialistic. Two-fifths claimed that they often buy presents because of a sense of obligation rather than generosity, rising to more than half among the 50-to-54 age group.

Half will use credit cards
Saga's research also revealed older Britons' reliance on credit to fund Christmas. Half revealed that they will turn to store cards or other credit cards to pay for Christmas presents this year. Store cards can be a useful way of spending with specific retailers, and many offer attractive perks to cardholders. But there is a risk that consumers could run up debt in the new year, as the interest rates can be prohibitively high for those who fail to pay off their card balance in full at the earliest opportunity.

Instead of using a store card, Christmas shoppers may want to consider using a credit card that charges 0% interest on purchases for several months. A number of 0% purchase cards are on the market, giving consumers plenty of time to pay off their balance without accruing interest. This could be a useful solution for those consumers who are good at managing their borrowing, but who need a few extra months to repay their Christmas debts.

See related: Credit card companies roll out Christmas promos, Brits willing to stretch budgets for Christmas

 

Published: 4 December 2012