Three quarters of families are at risk of developing debt management problems as research shows they are set to spend more money than they can afford on keeping children entertained over Christmas.

The additional cost of keeping children entertained over the festive season means that more than three in four parents (77 per cent) admit that they will spend more money than they can afford to on their kids, during what is an already expensive time of year.

According to research from online bank, Egg, the average family is set to fork out almost £40 a day on keeping boredom at bay from their children during the Christmas break.

Along with splashing out on toys and presents, parents are most likely to keep children entertained by spending on additional activities such as going to the cinema, going out for lunch or for buying books, comics or DVDs.

This all adds up to an average cost of approx £540 for the two-week British Christmas holiday.

Ivan Cooper, Chairman at debt advice specialists Chiltern, said: “Overstretching financially at this time of year can prove very damaging to finances throughout the rest of the year, as household budgets are squeezed to make repayments.

“With interest rates and additional tax rises expected next year, household finances are already set to be under increasing pressure, so it’s best to avoid potential debt problems by keeping spending in check over Christmas.”