SMUG MONEY: What will you dip into this Christmas?

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What will you be dipping into this Christmas? The houmous, or the blue cheese?

Actually, this is not about what you do with your carrot sticks at parties. Rather, what you do when you don’t have quite enough in your current account to pay for this year’s festivities.

Will it be the healthy houmous savings account? Or the artery-hardening blue cheese credit card?

That might be to do with whether you are a JAM-mer or JAS-ser – a “Just About Managing” or a “Just About Saving”. These terms are simply a way for politicians to divide a group of people who are two sides of the same modest-income coin.

There is very little between the Jammers and the Jassers except the Jammers might have no choice but to turn to their Mastercard, or worse – the newly ascendent “benefit loan”, whereas the Jassers might just find there is enough squirrelled away to pay for an extra few mince pies.

Of course, whether you turn to credit or savings to pay for Christmas might just be a matter of personal preference. You’ve got plenty of houmous, thanks, but you see no harm in dipping into the blue cheese too. It’s Christmas, after all.

Here’s a confession: I’m at the end of my monthly salary, it’s December 6 and with entertaining as well as small children and large families to cater for, I’ve already turned to the blue cheese. I know it is the shameful option, but hear me out.

It’s not that I do not have savings – I have got a modest sum sitting in an ISA that I could use for this purpose. But I really don’t want to. I want that to be rainy day money. Meanwhile, the credit card is right there, in my wallet, with 6 months’ 0% interest on purchases.

I am not condoning using credit to pay for Christmas widely. I’ll be paying off the £200 or so I spend on it now in January, the month of gruel – when both houmous and blue cheese are luxuries and we save money by dieting in every way.

But the fact is more and more of us are turning to credit routinely – not just at Christmas. Consumer credit grew at its fastest pace for 11 years in October, according to the British Banking Association, at an annual rate of more than 7 per cent. £6,991 is the average credit debt per household, according to the Money Charity, £462 more than the same time last year.

The use of credit might be a trend, but unlike the wearing of Ugg boots, it is not particularly one we would recommend following this winter. The truth is, if you are just about managing the rest of the year, as so many are, you can’t really afford Christmas, full stop.

National Debtline reckons the average British family spends around £800 on Christmas. According to Scottish Friendly, nearly a third (31%) of UK families with children are worried about how they’re going to pay for the costs associated with Christmas this year, while 13 per cent say they spend more than their income on essentials anyway, even when it’s not Christmas.

So where does that £800 come from? Often, the answer is credit. One credit union, Your Credit Union, is even reporting a rise in the number of families taking out loans secured against Child Benefit payments to make ends meet this Christmas.

At the same time as credit is reaching crazy highs, personal savings rates are going down. The household savings ratio has gone down from 5.6 per cent of income at the start of the year, to 5.1 per cent now.

This is clearly a troubling imbalance, which indicates that it is lenders funding lifestyles, not employers.

Christmas is unbelievably hard for the cash-strapped who are trying to resist spending. What is the best way to deal with this pressure without totally giving in to it and getting massively fat on credit, or going the other way and being the one who says “Christmas is cancelled”?

Well, you can either cover yourself in cushions and refuse to leave the sofa except to go to the toilet or make a cup of tea, or you can steel your nerves, make a plan and DO NOT veer from that plan. No matter how sweet the music in Fortnums, no matter how much you want to try stilton with honey and truffles, and no matter how many brochures Not on the High Street send you in the post.