Christmas is the same day every year so there is no reason to be caught off guard. Stop winging it and start planning for it today. Remember life still goes on after the holidays so no need to feeling guilty for having overspent in this area. There’s one way to guarantee this – create a budget. Yes, you need a budget even for the holidays. This is not to make you feel restricted; it’s to help you have a spending plan for your money.
Your holiday budget should cover these areas: a. Gifting & Giving b. Food & Booze (Ham, Turkey & Eggnog ain’t cheap boo) c. Decorations d. Traveling to family e. Other potential holiday-related expenses
First, let’s set some real boundaries right at this moment. Decide on the maximum you are prepared to spend for the holidays. This will include everything from decorations to gifts to food and booze. Find a realistic amount that you can handle and start saving that today. This can be done by breaking down line item by line item. For example, set a budget of X dollars for decorations; Y dollars for gifts and Z dollars food & booze. Add up that total amount and go from there.
Always remember it’s the thought that counts. I know that sounds cliché but it is so very true. It’s all about quality; not quantity. Focus on the meaningfulness of the gift rather than the dollar amount. Trust me if you spend $500 on a gift, it doesn’t necessarily mean that it would be considered any more special than a $50 gift. I’ll give you an example. I have a close friend of mine who told me about Christmas time in her family back in the day. While she and her brothers would spend (maybe hundreds of dollars) on gifts for each other, her little nephew always managed to choose the most indelible (and inexpensive) gifts ever. And guess what? Those are the ones she still cherishes and can put her finger on to this day. Think of creative ways to cut spending. Who knows? A small, thoughtful gift may just do the trick.
Begin searching for bargains now. And no, you don’t have to wait until Black Friday. Some online stores are already posting deep discounts on items such as clothing, accessories, etc. The reality is discounts for certain items probably won’t be that much better in the upcoming weeks. Two nights ago after a long sabbatical, I went on Old Navy’s website and to my surprise, they had a 40% discount on clothing. Well, I don’t have to tell you that all my godchildren items are already purchased at an amount less than $100 collectively.
Resist spending on credit cards “in advance”. “Oh, I can always pay this off when I get my Christmas bonus/Asue.” Famous. Last. Words. Don’t fall into this trap because that’s all it is. The Christmas bonus comes and then all of a sudden you have other stuff to pay for. The asue draw arrives and it’s spent before you even get home. End result: Credit card bill never gets fully paid. January rolls around and you’re like gosh darn it, I have all these bills. Don’t set yourself up, darling! Spend only if you have the money and if it’s specifically for the holidays.
Track as you spend. Easier said than done…I know. Make sure you’re keeping a running total of every single penny you spend. To avoid overspending, place the different categories i.e. decorations, gifts, food, etc. in cash envelopes. TheBudgetMom.com has some really cute ones that are totally free. Once the cash is spent out the envelopes; it’s gone. Like gone, gone! No replenishing from “other places”. Christmas is 1 day out the year. You still have to live the other 364 days out of the year. Always keep that in mind.
Lastly, start next year’s holiday sinking fund in January. This is a recurring expense so plan ahead to prevent anxiety for Christmas 2019. At that point, you have 11 more months to prepare. Determine the amount you would to spend next year, divide that by 12, and save that amount each month. It becomes so much easier that way.
Above all else, don’t allow debt to be the Scrooge that robs joy from your holiday season.