Four in ten consumers are worried they will not be able to afford Christmas this year, with 83% saying the cost of living will impact festivities.
As much as a fifth will start their Christmas shopping earlier this year with three quarters of them doing so for financial reasons.
And four in ten of these early shoppers say that things are cheaper if bought early.
A third of parents worry that their children will be upset at not receiving as many gifts, with around one in eight saying they are extremely worried.
The Post Office research of 2,005 UK adults found a quarter say they plan to spend less money on close family and over a third will spend less on extended family and friends – with half saying Christmas will be a smaller occasion this year.
It also emerged that almost one in six plans on making homemade gifts; with the number one reason being to save money (63%). Whilst over half think it’s more thoughtful and over a third do so to be creative.
The number is higher amongst 16–34-year-olds with a third planning to make homemade gifts; 69% will do so to save money. Londoners are the most likely region to do homemade gifts, with one in four planning on it.
Four in ten plan to use cash to purchase Christmas gifts this year, and of these, two-thirds will do so to manage budgets and keep track of spending. A quarter plan to gift cash this year.
It comes as the Post Office announced that it handled a record £3.45 billion in cash during August, with branches on track to further this record in October.
As Christmas edges closer, Post Office are encouraging consumers to get ahead and post letters and parcels early.
Kristian Latham, Head of Letters & Parcels at Post Office at the Post Office, said: “Our research has shown that the cost of living will be impacting Christmas for many this year as households tighten purse strings. This is set to affect how we shop, with more and more consumers planning on buying gifts earlier for financial reasons.
“Our branches will be open as usual in the run up to Christmas, helping consumers to post early as well. This is a great way to make the most of cheaper posting rates, whilst leaving plenty of time for cards and gifts to arrive before the big day.
Despite half feeling excited, happy or optimistic about Christmas, the number of people feeling anxious and sad about the occasion has increased from just over one in six last year to almost one in four.
The Post Office study went on to find that half of Brits shopping earlier this year are doing so to be more organised, with a third saying they make better decisions when not in a rush.
A fifth of those shopping earlier this year said they are doing so to ensure gifts arrive on time, with a quarter worrying that a late gift would look like they hadn’t made an effort.
Four in ten admitted they enjoy Christmas shopping, with seven in ten planning on doing theirs in one of the sales.
Yet the majority of Christmas shoppers (74%), will be finishing up their Christmas shopping in December with one in three leaving it until just one week before the big day to pick up their final bits.
Struggling to know what gift to buy is the top reason people give for not getting their Christmas shopping done early.
Latham added: “As Brits gear up for the festive season, it’s important to choose the best service for your precious gifts; the value of the item, speed of delivery needed and any tracking requirements are all important. If in doubt, our expert Postmasters can recommend what’s best for your parcels.
“If you are posting goods or gifts abroad, being aware of what can and can’t be posted and getting customs forms right are vital to ensure parcels are not delayed or returned. Guidelines to filling in customs forms correctly are on our website and of course our Postmasters are always on hand to help.”
For more information this Christmas period, head to the Post Office’s Christmas hub, https://www.postoffice.co.uk/christmas