Christmas debt: How to avoid going into the red this December

At Christmas your bank balance can take a hammering, so it's a big help if your employer enters into the festive spirit and pays your December salary a week or two in advance.

However, the downside of getting paid a little earlier is that it's easy to lose track of your debit card transactions and direct debits – and your next payday could be up to six weeks away.

Failing to keep tabs on your current account balance because you have decide to worry about it later could mean you exceed your agreed overdraft limit and face hefty bank charges in the first few weeks of 2016.

That's not the best way to kick off the new year, particularly as you will have the post-Christmas credit card bills to deal with too.

If you think you could do with a little more financial breathing space over the festive period, speak to your bank or building society now to arrange an authorised overdraft sufficient to see you through to the end of January.

It is usually a simple process and can be arranged very quickly either online, by phone or face to face in your local branch.

Once you've got your safety net, make sure you keep a close eye on your balance; there's no excuse not to now with the information available 24/7 online, on your smartphone app or via an ATM.

To illustrate the importance of staying within your agreed limit, I looked at how much it could cost if your bank let you drift £200 over your limit due to two £100 debit card payments, and then your account stayed overdrawn by this amount for seven days in a row.

The numbers are too big to ignore, with customers of Lloyds facing a bill of £76, NatWest and Santander customers £42, and Halifax and Barclays £35.

So be proactive and get your finances organised, otherwise whichever deal you're signed up to can end up hitting your pocket hard.

Pension confusion is stifling long-term savings culture

Saving to ensure a decent standard of living in retirement should be on our radar from a relatively early age, but people are being put off because pensions have become too confusing.

While rock-bottom interest rates haven't done much for our attitude to putting money away, the constant meddling with pension rules and regulations means people simply don't understand how much they should be saving or what they will be entitled to when they finally give up work.

New research from the Open University Business School (OUBS) highlights the level of confusion, particularly around the new state pension.

According to the findings by OUBS, 60 per cent of employees aren't aware that those who have been contracted out may not get the full amount of the new state pension. Even more worrying is that almost a quarter of working people don't know whether they've ever been contracted out.

The persistent meddling with rules has created too much uncertainty among would-be savers and is a big reason why people are not putting enough by for retirement.How can they be expected to plan for the future if the goalposts are constantly being moved? Until it's clearer who gets what and how much people should be saving, the situation will not improve.

Andrew Hagger is an independent personal finance analyst from www.moneycomms.co.uk