Data from Vanquis’ Financial Wellbeing Index found that one in five UK households earning under £40,000 had planned to cut back on Christmas spending in 2025, as families continue to juggle rising living costs.

Across all households, the Index revealed that people were most likely to trim back on treats like eating out and parties while doing their best to protect essentials such as the food shop and the cost of travelling to see loved ones.

For families that struggled this Christmas, many will already be thinking about how to make the 2026 festive season a bit less stressful. To help these households build healthier spending habits, strengthen their financial resilience, and approach Christmas with more confidence, Vanquis is sharing his top practical tips for saving and budgeting in the new year. These easy-to-follow strategies are designed to help people stay in control of their money year-round and make Christmas more enjoyable.

1. Automating your Savings: The Index found that those earning under £40,000 have been able to save just 1.48% of their income over the past year. For many, that leaves little room to build resilience. But setting aside even small, regular amounts can make a meaningful difference over time. Automating a payday transfer (of even just £25) into a separate savings pot is a simple, low-effort way to start building a longer-term financial buffer. By next Christmas, this could amount to an extra £300, providing more flexibility to enjoy the festive season without financial strain.
2. Starting your emergency fund: The Index also found that only 42% of those earning under £40,000 feel confident that they could afford an unexpected one off £500 expense. This means that a one-off expense like a boiler repair can quickly put Christmas spending at risk. Using round-up features and goal trackers is a great first step to building a £250–£500 emergency fund that can make all the difference. It’s worth checking whether your current account offers this feature, so you can build a stronger cushion against financial shocks and keep your Christmas money protected.
3. Doing a 30-minute bill and subscription check: With the Index revealing that household bills have risen 12% over the past two years, it’s more important than ever to review your current arrangements. Checking your energy tariffs as well as your broadband, mobile and insurance rates and switching to cheaper options could free up £500 or more in as little as 30 minutes. Spending tracker apps such as Snoop are a great way to make this process as convenient as possible. These apps can audit your subscriptions, helping you identify and cancel the ones you barely use. Setting subscription renewal reminders will also ensure you aren’t caught out by auto-renew traps.
4. Check for the support available to you: Finally, many households risk missing out on the support available to them. Taking the time to explore benefit top-ups, council tax reductions, and other bill-support schemes can unlock meaningful extra help, which could be worth hundreds of pounds a year. Tools such as online benefit calculators can show you quickly if you qualify, and organisations like Citizens Advice offer clear, step-by-step guidance on how to make a claim.

Commenting on the Index findings and spending tips, Vanquis Marketing Director Paul Lloyd, said:

“We know the Christmas period is a real balancing act for many families, with people trying to enjoy the festive season while keeping a close eye on their money.

Building financial resilience is a long-term effort and is achieved by better saving habits and cutting unnecessary expenses. The start of the year is the perfect time to be thinking ahead to make the 2026 festive season less financially stressful. Even simple steps taken today can make a meaningful difference over time, whether that’s setting up a small automatic transfer into savings on payday, using round-ups to build a starter emergency fund, or spending just half an hour checking you’re not overpaying on household bills and subscriptions.

“Planning ahead doesn’t have to be complicated. Small changes today can help create a stronger financial safety net, allowing families to approach future Christmases with more confidence.”