Hello again, savvy savers! Starting each Thursday, through Christmas Eve, I’ll be posting a deals and steals series, to help us all Countdown to Christmas!
I know many people may think this title of this post seems off, but its not! I shop early, spend less, and generally have my holiday shopping purchased prior to Thanksgiving! As a general rule, I never spend more than $300.00 for our holidays and we generally have huge holiday celebrations to prevent post-holiday consumer debt! Each week, I will discuss an idea on how to prepare for the holidays on a budget, so when the big day actually arrives you will be ready to go, with a few hundred spent, instead of a few thousand!
So this week I want to discuss, step-by-step how to create and maintain a holiday budget! Budgeting is essential for holiday spending. To keep your saving savings grounded before you begin making gift lists and dreaming of a DIY, Pinterest-esque winter wonderland filled with décor ideas, presents, and outings, you must set the season’s financial limits with a Christmas budget.
1) Make A List Of Everyone To Whom You Want To Give A Christmas Gift.
Be sure to include the following groups of people:
- Family – aunts, uncles, children, spouse, cousins, siblings, grandparents, and even the stray dog your brother-in-law adopted. Include everyone you WANT to give a gift to.
- Co-workers – partners, bosses, co-workers, support staff
- Church friends – Bible school teachers, church staff, grandparent figures
- Community friends – neighbors, fellow volunteers, clerk at the grocery store
- Those who provide services – paperboy, mail man, pizza delivery boy, yard worker, pool cleaner, teachers
- Anyone else – feeling jovial? Put them on the list.
2) Determine How Much You Can Afford To Spend On Christmas.
This step is relatively simple. All you need to do is to figure out how much money can you save between now and December 25th? And then calculate what percentage of your budget is for only presents this holiday season.
My personal Christmas Spending Rule: How much you can afford to spend must be an amount you save in CASH. This is how much you actually have to give for Christmas. If the number is low, that is fine. Cash is king for holiday spending.
Remember, Christmas should never be about financially crippling yourself to ensure someone will receive a gifted pair of reindeer, light-up glitter socks that will go in the trash before January. Christmas is about expressing love and appreciation; both of which can be done without money. Christmas can be enjoyed without money. Be sure that your budget is proportional to your income.
3) Prioritize Your List From Step #1.
Shorten your first list. Really only list gifts for those closest to you. Then be sure to consider the following items in your budget:
- Stocking stuffers
- Gift wrap
- Postage and shipping
- Christmas cards
- Holiday photo
- Tips and service gifts
- Holiday meals
- Baking and kitchen gifts
- Décor items and Christmas tree
- Home improvements
- Travel expenses
- Holiday clothing
- Charitable donations
- Post-Christmas sales
What’s left on your list is how much you CAN actually spend on gifts for others.
4) Categorize every person on your list.
At this stage you are just going to separate each name into four groups – paid gift, made gift, free digital gifts, no gift groups. Since you know how much you can afford to give you will have a better sense of how many people can be on your paid gift list.
Paid Gift List: Beside each name on the paid gift list, assign a budgeted amount. Be sure that total does not exceed the amount in Step #2. The only rule here is you cannot overspend that amount on that person.
Made Gift List: What will you make? Are you crafty? Can you knit? Then Aunt Sally who lives in Alaska might be best suited with a scarf! Can you baker? Cookies and other Christmas treats are a great idea for close friends, neighbors, and colleagues. Do you attend parties? Think DIY potpourri, wreaths, candles, or knitted items as unique, loving hostess, church function. Also, these same gifts can be made ahead of time for service members in your life; this is an awesome way to satay under the mandated $5.00 gift giving rule for USPS, UPS, FedEx, many municipality civil and city workers too; holiday teats and potpourri can be frozen and thawed before gift giving. For family, a customized card with a picture of the kids will suffice.
Digital Gift List: You might want to cut out your Great Aunt Sally, if you have only exchanged cards for the past two decades. You might want to send a card to a business partner, in lieu of an expensive fruit basket. Before cutting either off the list consider ways to give digital gifts to family and friends for free. Consider cashing in Swagbucks, Recyclebank, iBotta, and Receipt Hog points for digital free cards and gifts for those on your list. Free magazine subscriptions, with print-outs attached to cards works well too. No one will ever know that this same gift cost you nothing, but the time it took to think of your loved one this holiday season!
No Gift: For those that made it on your first list, but you would rather allocate the funds from their gifts to someone on a higher gift list, you might just send them a personalized card instead. For this list you will need to actually send a card, not a holiday e-vite or a digital card, an actual card. Remember, sending someone holiday tidings, can be a much-needed gift unto itself. As well, how awesome is it in a digital, high-paced world to still receive holiday cards in the mailbox. I know I love them, and in fact keep them from year to year!
5) Make The Budget Work To The Penny.
You should never spend more than you budgeted. If your budget is tight, you are in luck as all you will need to capitalize on your two best resources – CREATIVITY and TIME. Think free gift cards and discount racks, not credit card bills!
With the holiday season a few short months away consider now the time to prep, purchase, wrap, and store all your holiday gifts, and to allow yourself the greatest gift of all, a stress-free holiday with those nearest and dearest to you!
Another great step is using a holiday budget sheet. I have been using these Free Holiday Budget Worksheets for the past few years and they have worked great! Remember to also keep an ongoing tally of your spending, and include your budget sheet, along side your money envelope, each time you make holiday purchased this coming season.
So savvy savers! How Do You Set Your Christmas Budget? I’d love to hear about it below!
Here’s to the holidays,