Christmas is expensive. This is how smart women will pay for it.

With the festive season in full force, it’s time to think about how you’ll fund the endless costs of the holiday period (if you haven’t already done so).

This time of year is notorious for being a whirlwind and it’s likely your household budget will take a hit, so plan ahead and think about how you’ll cover the extra holiday costs and avoid things going haywire.

Forty percent of Aussies will turn to credit to fund their Christmas shopping, according to a new finder.com.au study.

With the average Aussie spending $539 on gifts alone this festive season, over $215 per person will be funded by credit, which works out to be around $3.9 billion nationwide.

More than one in three (36 per cent) Aussies will put their Christmas gifts on plastic, while 4 per cent of will use a loan. It may not occur to some of us, but waiting on that work Christmas bonus, is another way to manage costs, with 3 per cent of Aussies plan on doing.

The study also found that over 180,000 Australians will use funds earned through the ever-trending sharing economy, such as Airtasker or Uber, to pay for their gift expenses.

If we zoom in on gender financial habits, women are more likely (79 per cent) to use cash/savings to fund their festive shopping compared to men (70 per cent). As a result, women are less likely to draw upon credit with just 30 per cent of women putting their Christmas shopping on a credit card, compared to 42 per cent of men.

To curtail your expenditure, consider these money-saving tips.

1. Budget with care.

Drawing a detailed and thought-out budget is the most sensible way to tackle the festive spending season. Identify the additional costs you’ll encounter (remember, think broadly) and set yourself a spending limit for each item.

Whether it’s a micro budget for flights, accommodation, entertaining the kids during the school holidays, and/or for your gift-buying, set yourself a clear spending goal for each category so you have greater structure with your expenditure. Use a budgeting app, such as Pocketbook or TrackMySPEND to help you stay on track.

When setting your budget, think of abstract ways to save money. Whether it’s opting for the right mobile phone plan (that churns through less data when you’re streaming internet TV), shopping at a discount supermarket, or even using the sharing economy by renting out a spare bedroom, there are many ways of creating an extra income source if you put your mind to it.

2. Review your need for finance.

It’s not the most riveting of topics, but knowing your financial position and your spending personality can help you review your need for finance.

For example, if you currently have several credit card and personal loan accounts, and you’ve fallen behind on your repayments, you may want to be cautious about extending your debt. If you also know you have a bad credit score (you can now access it for free online) and that you’re likely to make impulse purchases and get swayed by marketing tactics, you may want to think twice before taking out another credit card as doing so could put you in a debt spiral.

3. Use the right credit card.

For those of us that do need to put some purchases on plastic, or who are thinking of signing up for a new credit card, opt for a product that supports your spending needs. There are several competitive products out there, such as 0 per cent purchase rate cards, balance transfers, cash-back offers, and frequent flyer programs that come with relevant features and benefits.

However, you need to select a product that will complement your spending needs. For instance, if you travel frequently for businesses, you may benefit from a frequent flyer program, or if you want to trim your interest charges, opt for a 0 per cent purchase rate card.

4. Watch out for delivery/shipping costs.

If you plan to do some shopping online, be wary of retailers that charge excessive fees for delivery/shipping as some will charge up to 10-15 per cent for delivery (on top of your total spend, including GST).

To dodge this, browse online sites that offer free shipping/delivery (brands will normally promote this pretty clearly on their site).

5. Steer clear of online marketing tactics.

Many retailers up their marketing tactics at this time of year to entice you to spend big. One way brands do this is by imposing a minimum dollar limit to be eligible for free shipping which prompts you to spend more than what you initially planned. To prevent this from happening, either browse retailers that don’t impose a minimum spend limit for free delivery/shipping or wait and shop when you need to buy in larger quantities.

Other marketing ploys include recommending complementary products in your shopping cart and targeting you with special membership offers.

To get around this, stick to your budget, avoid impulse buys, review shipping/delivery costs, and carefully read return policies before you click ‘purchase.’

6. Don’t buy gift cards on plastic.

Depending on the provider, you may be charged a cash advance fee if you buy a store gift card using your credit card. If you are thinking of buying a gift card, pay using your debit card or cash instead – it’s as simple as that.

7. Avoid overdraft fees.

Both December and January will be big spending months which could push your account balance below zero, resulting in an overdraft fee. To avoid this, check out the terms and conditions related to account overdraft fees so you know what you’re getting into. If you can, contact your provider and tweak your account settings so purchases will be declined if your balance falls into the red.

As we prepare both fiscally and mentally for the holiday break and the chaos that is school holidays, remember to budget carefully and to keep your wits about you.

And most importantly, remember to breathe.