For the first Christmas since the pandemic, more people in the UK plan to spend more on Christmas than plan to spend less. A PwC survey of 2,070 UK adults, carried out in the second week of August 2026, found 25% expect to spend more on Christmas shopping and celebrations than last year, against 21% who expect to spend less. It is the first time that balance has tilted towards spending more since the pandemic, and it comes as consumer sentiment turned positive — at +1 — for the first time since September 2021.
Shoppers are also starting earlier. Some 14% of those surveyed said they had already started their Christmas shopping by mid-August, and a further 16% planned to do most of it earlier than they did last year. The most upbeat age group was 35 to 44-year-olds, whose sentiment reached +21 — the highest score for that group since the survey began in 2008.
"For retailers, Christmas needs to come early. Consumer sentiment has hit positive territory for the first time since the pandemic, and some people have already started festive shopping," Jacqueline Windsor, PwC UK's head of retail, said. "It's a golden period of consumer confidence that may have come too early for the Golden Quarter. We expect food and fuel inflation to bite in the Autumn."
That caution matters, because the optimism is fragile. PwC's own survey found 85% of consumers remain worried about the rising cost of everyday things. And the mood has already cooled since the survey was taken: market research firm GfK's consumer confidence index fell 11 points to minus 24 in October, its steepest monthly fall since the early days of the pandemic.
Last Christmas, 14 million adults struggled to afford it
The other side of the festive picture is what happened last year. New polling by StepChange Debt Charity, carried out by YouGov among 2,070 adults on 17 and 18 November 2025, found more than one in four British adults (27%) — around 14.3 million people — would struggle to afford Christmas. Among parents with children at home, the figure rose to almost one in three (31%).
Around 4 million adults — one in twelve — said they would struggle to afford Christmas and would rely on credit to fund it. Of those using credit, six in ten (60%) said their borrowing would be higher than the year before, and almost nine in ten (87%) said they were borrowing because of the higher cost of living. More than two in five (43%) expected it to take more than six months to repay the credit they used for Christmas, and almost one in five of those (17%) expected it to take more than a year.
Almost one in four people who celebrate Christmas (23%) could not afford to set any money aside for it at all, StepChange found, while just over one in three (36%) had been setting money aside throughout the year.
"Christmas is a time for joy and togetherness, but we understand it can also bring financial pressures, especially for those already struggling with debt or tight budgets," Vikki Brownridge, chief executive of StepChange Debt Charity, said. "If you're considering using credit cards, Buy Now, Pay Later, or other borrowing options, take a moment to think about whether repayments will still be manageable in January and beyond."
Borrowing for Christmas has rarely been dearer
Anyone who does put Christmas on a credit card this year will be borrowing at the highest advertised rates on record. The Bank of England's average quoted interest rate on representative credit cards was 24.71% in September 2026 — unchanged since June, and the highest since the Bank's series began in 1995. The effective rate actually paid on interest-charging cards was 21.71% in September, up from 21.55% in August, according to the Bank's Money and Credit release.
Credit card borrowing is still growing fast. The Bank reported annual growth in credit card borrowing of 13.1% in September 2026, with net credit card borrowing of £0.7 billion in the month, down from £1.3 billion in August. Consumer credit borrowing overall grew by 9.8% over the year to September.
Buy now, pay later is the other way millions of shoppers spread the cost — and this is the first Christmas it has been regulated. The Financial Conduct Authority began regulating Deferred Payment Credit, the interest-free form of buy now, pay later repaid in 12 or fewer instalments over 12 months or less, on 15 July 2026. Lenders must now be authorised by the FCA or be in its temporary permissions regime, must check that a borrower can afford the repayments before lending, and must offer support to customers who fall into difficulty. Shoppers can also complain to the Financial Ombudsman Service, and Section 75 of the Consumer Credit Act is available.
The scale of the market explains why the regulator acted. The FCA's own figures show buy now, pay later lending grew from £0.06 billion in 2017 to more than £13 billion in 2024, and its 2024 Financial Lives Survey found 20% of UK consumers — 10.9 million adults — had used it in the 12 months to May 2024. But the new protections have limits: agreements taken out before 15 July 2026 remain unregulated, and credit offered by the shop itself, rather than a separate lender, is not covered.
The advice from debt charities: decide the total first
StepChange issued new guidance on 22 October 2026, urging households to get ahead of what it calls the January financial blues. January is the charity's busiest time of year for debt advice, and its message is to make the plan before the spending begins: work out the full Christmas total — presents, food and drink, travel, parties, postage and decorations — and check it against what is genuinely affordable after essential bills.
Its example is deliberately small: if you can afford £300 in total and have three paydays before Christmas, set aside £100 from each, provided that does not leave you short for essentials. It also advises writing the present list before Black Friday and the other sales begin, agreeing a spending limit with family and friends — or a Secret Santa, or adults buying only for children — and putting every buy-now-pay-later repayment through what it calls the January test: "Will I still be able to afford this repayment when Christmas is over?"
"Most importantly, don't let the pressure to have the perfect Christmas leave you struggling in January. And if you're already worried about debt, you don't need to wait to get help — the best time to reach out is now," Brownridge said. Free, impartial and confidential debt advice is available from StepChange now, before the spending starts, rather than in January when its advisers are at their busiest.