The real cost of Christmas hitting Aussie households in 2026

• More than half of Aussies feel greater financial stress heading into Christmas than a year ago.
• They expect to spend an average of $1,399 per adult on Christmas and summer holidays, down from $1,750 last year.
• Financial experts warn that using credit cards or buy-now, pay-later services to fund Christmas celebrations could leave households struggling with debt well into 2027.

Australians struggling with rising living costs are scaling back Christmas celebrations, as financial pressures force families to rethink long-held festive traditions.

New research from St Vincent de Paul Society (Vinnies) found that 52 per cent of Australians feel more financially stressed heading into Christmas this year than 12 months ago, while 36 per cent have felt the need to hide financial hardship from friends and family.

Financial Spectrum managing director Brenton Tong said end-of-year traditions are adding to household stress.

“There is still a taboo around finances, so a lot of people don’t like to talk about it,” Tong said.

“A lot of people would prefer to go into debt to fund Christmas rather than admitting that they’re doing it tough and can’t afford [it].”

For Angela*, 50, who lives in regional Victoria, financial pressure is making an already difficult Christmas even harder. 

Her husband, Rick*, 53, was diagnosed with early-onset Alzheimer’s disease in 2025, and was recently hospitalised for more than a month with limbic encephalitis, a condition that causes inflammation in the brain.

With Rick no longer able to work and Angela now his full-time carer, the couple are adjusting to a significantly reduced household income, mounting healthcare expenses and higher living costs.

With Christmas approaching, Angela has to make some difficult decisions about what they can afford.

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Normally, the couple would celebrate both lunch and dinner with Rick’s extended family, buying presents for children and adults alike. 

This year, they’re planning to attend just one gathering, partly because Rick now finds noise and socialising exhausting, but also because it will help reduce their Christmas food bill.

Keeping costs low

Angela is hoping to convince the family to introduce a Kris Kringle gift exchange to reduce the cost of buying presents for everyone, but she said not everyone is keen on the idea.

“And then I feel like I have to, and we financially can’t do it,” she said. “If they don’t do a Kris Kringle, I’m just going to have to say I can only buy for the little kids, because it’s just too much.”

Despite the pressure to keep up with family expectations, Angela said she finds it difficult to admit how much they’re struggling to make ends meet.

“His family are very good, but I don’t tend to tell the family how bad things are financially because I feel embarrassed,” she said.

Angela isn’t the only Aussie feeling the festive season pinch. 

Australians expect to spend an average of $1,399 per adult across Christmas and summer holiday expenses, down from $1,750 last year, according to Finder’s 2026 Shopping Report. 

Meanwhile, 26 per cent plan to buy fewer gifts than usual.

For Angela, keeping Christmas spending under control means buying presents throughout the year when they’re on sale, keeping detailed lists and sticking firmly to a budget.

The family also shares the cost of Christmas meals, with everyone contributing one or two dishes to avoid unnecessary spending and food waste.

She’s also started following frugal living pages on Facebook for money-saving tips and is cooking more meals in bulk to freeze for later.

“I never used to be that frugal, but I just hate waste now,” she said.

The trap of buy now, pay later

While some households turn to credit cards or buy now, pay later services to cover festive expenses, Angela said she no longer has credit cards and only occasionally uses Afterpay for convenience.

“If I can’t afford to pay for it now, I won’t get it,” she said. 

Tong warns that turning to credit cards or buy now, pay later services to cover festive expenses could have longer-term financial consequences.

“When you borrow to fund consumption today, you’re taking next year’s income and spending it now,” he said.

The added costs of borrowing can make repayments harder to manage, especially when households are also trying to cover regular expenses.

“That’s a debt spiral, and it can be very hard to get out of without professional help,” Tong added.

Rather than trying to maintain every tradition, Tong recommends identifying which parts of Christmas matter most and directing spending towards those.

“Focus on the things that matter, cut the rest so you can do those things and do them properly,” he said.

For Angela, the financial pressure is just one part of an incredibly difficult year, and she admits she’s struggling to feel enthusiastic about Christmas.

“I really don’t want to celebrate it,” she said. “Well, I suppose we do have something to celebrate. I mean, he’s here.”

*The names in this story have been changed to preserve privacy and anonymity.