Over 13.5m UK adults are planning to cut back their Christmas spending this year as households feel the squeeze of soaring prices and stubbornly high living costs, new research from investment, protection, retirement and in-house advice specialist LV= reveals.

From spreading the cost of Christmas dinner to cutting back on gifts, families are finding new ways to cope with seasonal spending pressures while also trying to keep traditions alive. It seems budgeting may be becoming a new Christmas tradition for many UK households.

LV= research shows that 58% of adults, over 31.4 million people, say they are now budgeting for Christmas, and one in four (26%) are saving steadily throughout the year.

A quarter (25%) of people say they will spend less this year than they did last year, an increase of 3% compared to last year, continuing a steady downward trend in festive budgets driven by the cost-of-living crisis.

Parents of young children are the most prepared – the number of parents of under 10s that budget for Christmas rises significantly to four in five (80%). Consumers are taking a more thoughtful approach to Christmas spending, with many choosing to focus on financial stability rather than excess.

However, contrary to older generations, young Brits are bucking the trend and say they intend to splash out this Christmas. Almost three in ten (28%) 18 – 34 year olds plan to spend more this year, up by 7% on 2024 figures.

David Hynam, LV= Chief Executive, said:

“Consumers are clearly adapting to the new economic reality, making more intentional choices about how and when they spend. While overall our data is showing that Christmas budgets may be smaller, we are seeing pockets of optimism, particularly among younger people and families who are keen to celebrate.

“Budgeting is no longer just about cutting back, it’s about taking control, planning ahead and feeling prepared for the moments that matter most.”

LV= offers guidance on managing spend, visit the LV= Wealth & Wellbeing hub.