Christmas time is one of the most expensive times of the year for most of us. If we’re blessed with a big family and a lot of friends we find ourselves spending a small fortune on gifts, food, parties, and activities. It’s enough to set anyone back on their budget, but it doesn’t have to be that way. If you plan for your holiday ahead of time, you might just find yourself coming out ahead.
Start saving now
It might sound crazy to be getting ready for Christmas in the middle of summer, but if you start saving now you will have enough saved up by the time you need to do your Christmas shopping. Imagine making it through the holidays without charging a thing to your credit card! It’s possible if you start now. Set aside some cash in an envelope every month and label it Christmas Fund. Wondering just how much you need to save? You can get a better idea after you’ve created a Christmas budget.
Holiday Budget
Start by making a list of every single person you need to give a gift to this Christmas season. I’m talking nieces and nephews, friends, bosses, coworkers, your kids’ teachers, work gift exchanges, everyone you normally give gifts to. Then next to each of their names, write down how much you want to spend on their gift. You don’t have to spend as much as you have in years past. If you’re trying to survive the holidays without going broke, you’re probably going to have to spend less than you’re used to, and that’s okay! It’s the thought that counts.
Now think about parties, activities, and other expenses. Do you host a gathering every year? Are there holiday activities you plan to participate in (like ice skating, going to see The Nutcracker, etc.) this year? If so, add it all to your budget. And don’t forget to add gift wrap and Christmas cards. Is your budget total starting to look a little steep? Think about what you can cut out or how you can do things differently.
How to spend less on holiday gifts
Do you absolutely have to buy a gift for every single person on that list? Can you save money by doing handmade gifts or by giving them an experience instead of a physical gift?
I once had a friend ask me if I could teach her kids cake decorating. On Christmas day one of their gifts from her was a certificate for a cake decorating class with me. They came over and spent the day learning how to make frosting, frost a cake, and decorate it with borders, flowers, and lettering. They had a blast and it cost my friend nothing (I covered the cost of the mini cakes and the frosting ingredients which was pretty minuscule).
Think about what skills you can use as gifts. If you play an instrument, give your nieces and nephews a few free lessons. Offer your friends the gift of free babysitting. Bake or sew gifts for your coworkers. Get creative!
How to spend less on holiday activities
Do you have to participate in every activity on your list? Are there any you can cut out or replace with less expensive activities? Cutting back on expenses can be a challenge when you have friends or family inviting you to join them in a pricey activity. But you can say no, or better yet offer them an alternative. You can be honest with them. Tell them money is tight and you can’t join them for The Nutcracker this year but you’d be happy to meet them for dessert afterward.
Another way to keep expenses under control is to plan the activities yourself and make sure they are frugal. There are plenty of fun but inexpensive things to do with your family and friends around the holidays, such as:
- Bake and decorate cookies
- Drive around and look at the Christmas lights in the neighborhood
- Go caroling
- Have a Christmas movie marathon
- Read Christmas stories and drink hot cocoa
- Make ornaments or other holiday crafts
- Volunteer at a soup kitchen
Keep in mind, it doesn’t matter what you do or how much or little you spend on gifts as long as you show your family and friends how much they mean to you and get to spend some quality time with them.