The UK spending calculator: Christmas spending vs investing

Every December, the same thing happens. The UK becomes full of retail warriors, armed with credit cards and good intentions, spending more money than any other month.

The average UK household spends £713 extra in December, 29% more than a typical month. That's on top of the usual £2,460 monthly spending.

It raises the question: What if you invested that money in real estate instead?

Average UK festive spending

While the £713 extra spending is an average, total Christmas spending (including everything from gifts to food to travel) varies dramatically by region:

• London: £993 per person
• South East: £927 per person
• North East: £732 per person (lowest in UK)
• UK average: Around £840 per person total

The UK is expected to spend £23.7 billion in 2025. And every year, the same pattern: September promises of "keeping it low-key" followed by December panic-buying.

Where does that £713 actually go?

According to the Bank of England, December spending spikes dramatically on:

• Books, newspapers, periodicals: Sales more than double
• Alcohol: Up 38%
• Specialist food: Up 22%
• Video and music equipment: Massive increases

Meanwhile, DIY project and renovations are put on hold: hardware spending drops 19% as Brits postpone decorating projects until January.

What if you invest in property instead?

For comparison, let's say you invest that £713 annually in real estate instead of spending it.

But first, an inflation reality check. £100 today buys less than £100 five years ago - you might have noticed that the same grocery shop costs more and more over time. That’s inflation, the price of good and services increasing over time, meaning that your money buys less. Learn more here.

Real estate investment works differently. Using a 6% annual return (for educational purposes), here's what happens:

Invest for 10 years
Total invested: £7,130
Investment value: ~£9,400
Gain: ~£2,300

Invest for 20 years
Total invested: £14,260
Investment value: ~£26,000
Gain: ~£11,700

Invest for 30 years
Total invested: £21,390
Investment value: ~£56,000
Gain: ~£34,600

That 30-year figure? That's a property deposit or rental income for years, from money that would've gone to novelty items that end up in a charity shop or landfill.

Why do we overspend at Christmas?

Four psychological triggers at play:

Social reciprocity: You feel obligated to match what others spend on you.

Lifestyle signaling: Gifts communicate status. That expensive champagne says more about you than them.

Temporal discounting: We value immediate gratification over long-term gains. £713 of presents now feels more real than £27,700 in 20 years.

Loss aversion: Not giving gifts feels like losing something, even though it's just not spending.

Should I really not spend anything on Christmas?

Let's be clear: we're not saying eliminate Christmas.

Investment returns aren't guaranteed. Real estate, like any investment, carries risk. 6% is a reasonable long-term average, not a promise.

Christmas has non-financial value. Time with family, creating traditions, spreading joy: these matter.

Some spending is unavoidable. Food, travel to see family, modest gifts for children are reasonable.

But here's the point: most of us could cut Christmas spending without diminishing the experience one bit.

How to spend less on Christmas and invest the difference

Gift experiences, not things. A cooking class beats the latest kitchen gadget. Event tickets trump another jumper.

Gift investments to kids. A £50 Junior ISA contribution has more long-term value than any toy.

Concentrate your spending. One meaningful gift beats ten forgettable ones. Stop buying for everyone you vaguely know.

Question traditions. Do you need a fresh wreath every year? Do luxury crackers matter? Most traditions persist because we haven't questioned them.

Is it worth investing instead of spending on Christmas?

We're not saying don't celebrate. We're saying be honest about the trade-off.

Every £713 you spend on Christmas is £713 not growing in a property investment. Over 20 years at 6% returns, that's £27,700.

For most people, the Christmas memories wouldn't have been £27,700 better with the extra spending.

The challenge: Cut your Christmas spending this year. Invest the difference. See if anyone notices. See if you notice.

We're betting you won't miss the spending. But in 20 years, you'll definitely notice the extra wealth.

• Average UK household: £713 extra spent in December
• Invested at 6% every year over 20 years: ~£26,000
• Over 30 years: ~£56,000

That's not a Christmas miracle…. That's compound interest meeting real estate returns.

See how you can build wealth with real estate

All Investments carry risks. Stake Properties Limited is regulated by the DFSA as an Operator of a Crowdfunding Platform in the UAE.