Ten tips to get the ideal Christmas gift '“ a balanced budget

Last year, families spent around £820 on Christmas typically, previous research from VoucherCodes.co.uk and the Centre of Retail Research suggests. Many households will have put their Christmas on credit '“ but by planning ahead, it's possible to build a pot of cash and make savings here and there that will stop you having to fork out more than you need to.

Cutting out small luxuries could boost savings in time for Christmas. Photograph: PA

Sarah Coles, a personal finance analyst at Hargreaves Lansdown, says: “Given that you have a bit of time until Christmas, you can use the opportunity to put some cash aside, and use a few cunning tricks to boost your Christmas savings.” Here are her top tips for building a money pot for Christmas.

Save money each month

Set up a standing order to put money into a savings account as soon as you are paid each month, so you’re not tempted to spend your Christmas savings.

Consider microsavings

Some banks allow you to round up each spend to the nearest pound and save the rest, while some apps regularly take small sums of cash from your current account and put them into savings for you. The idea is that they’re so small, you don’t miss the money, but large enough to add up.

Switch current accounts

Some current accounts offer interest rates of up to 5 per cent, while others will give you a bonus for signing up – to kick-start your Christmas savings. M&S Bank, for example, will offer a £125 M&S voucher for switching, and another £60 voucher after you’ve stayed for six months.

A pre-Christmas clear-out

Have a look through the cupboards for old presents and things you haven’t used since last Christmas. If you sell them on auction sites or specialist sales sites, you could raise a handy lump sum.

Try trading down brands

If you buy branded goods, try the own-brands. If you buy own-brands, try the basic range. Alternatively, give a discount supermarket a try.

Cut out the small luxuries

This doesn’t have to involve a major sacrifice, but if you were to drop a family takeaway once a week, a daily coffee, and a drink after work on Friday, you could put aside an extra £200 a month, which would boost your Christmas savings nicely.

Prune the wish list

Once you’ve established your savings strategies, you’ll have an idea of what you can afford to spend. If you’re struggling, you can then decide either to cut back on each gift, or chat to people you know well enough and agree not to buy for one another this year. Who knows, they may be just as relieved by the idea as you are.

Cashback websites

Sign up to one or two cashback websites, and whenever you shop for anything between now and Christmas, you’ll get anything up to 15 per cent cashback.

Cashback credit card

This offers similar benefits, but only if you can afford to pay on time in full, otherwise it could cost you dear.

See people in the New Year

Not only will this give you another pay day to cover the cost of their present, but it gives you the option of re-gifting if your budget is really stretched.