Christmas credit crunch
Last year we spent £33 billion on festivities. But this Christmas there's more to worry about with mortgages, energy bills and whether they'll be a job to go back to in the new year. Unless you live in the North Pole, you'll know it's as much about interest rates and credit limits as it is about mince pies and Santa this year. So what does this all mean for how you're spending your money this Christmas?
There have been conflicting reports in the news about how spending on the high street has been affected. One minute we're told sales are down, the next we're told that bargain hunters are setting the tills ringing.
So, to get the real story we put a questionnaire on the Watchdog website to find out if the credit crunch is putting the kibosh on your Christmas. Over five days 5,490 of you took part.
Feeling the pinch
First we wanted to know if you'd be reining in your spending or filling up your stockings. Some of the results were quite a surprise because although 62 per cent of the people who took part are feeling the pinch, that isn't going to stop them spending. Some 66 per cent of those who completed our questionnaire said they were going to spend just as much or even more than they did last Christmas.
BBC Business Editor Robert Peston isn't surprised that even in these troubled times people want to spend at Christmas: "There's a rise in fear about what the new year will bring, but also at a time when we're all a bit gloomy, we want a bit of cheering up! Nobody wants to have miserable Christmas."
Where will the money come from?
We asked how you intend to pay for Christmas this year and a whopping 63 per cent of people who took part in our questionnaire said they'd be doing it with regular earnings. Surprisingly, just 17 per cent would be using a loan or credit card.
Analysts say that one reason people are using credit less is because it's harder to get. Verdict retail consultant Neil Saunders says: "It's much more difficult to get credit cards. People also don't want to take on credit, they're very uncertain about their future, they're uncertain about whether they'll have a job in three months' time and they're not wanting to rack up huge bills on credit cards."
Christmas under £500
We also wanted to know how much you'd be spending on Christmas this year. Two thirds of the people who took part told us that they'd be spending less than £500 on Christmas but one third said they'd be spending more. Neil Saunders says £500 is quite a lot for most families: "I think that people will find there's a bit of a crunch and that they won't have quite so much money to spend overall, but it's not going to be completely gloomy. It's the new year that might get interesting, that's when the bills start coming in."
Many high-street stores such as WH Smith, BHS and Marks & Spencer have slashed their prices to try and get our cash in their tills. But is the plan working? Only 26 per cent of respondents said that the pre-Christmas sales had drawn them into the shops to spend money. Over half said they hadn't been tempted to make a purchase.
One thing that definitely hasn't tempted you is Gordon Brown's snip at VAT. A massive 91 per cent said that the 2.5 per cent cut in VAT has not made them spend more money. Robert Peston says this cut has been overshadowed by the huge high-street discounts of 20, 30 and 40 per cent.
Finally, while many of you told us that this year you'd be looking for bargains in the supermarkets or online, 41 per cent said you'd still be sticking to the high street.