The holiday times are a magical time of year.
For me, it brings back memories of the season when I was a kid and still lets me create new memories for years to come.
However, it can also be a time of year when budgets are broken, spending gets out of control, and the meaning of Christmas can be forgotten.
On average, Americans plan to spend anywhere from $875 to $1,778 on Christmas spending this year, including buying gifts, decor and food.
From hosting holiday parties, going out to events and gift giving, there are ways to master your Christmas spending, stick to your budget and still have a fun holiday season.
5 Ways to Save Money & Plan Ahead for Christmas Spending
1. Make a holiday budget.
As with all financial advice, making a budget is crucial to not overspending.
While you should have a normal budget, you can create a separate holiday budget.
- You may have been saving up all year and have a certain amount you plan to spend for the holiday season.
- Make a plan for how much you want to spend in every category and stick to that budget as much as possible.
- Plan for more in each category so if you budget wrong, you can go over without having to touch your other savings.
- Make a budget for family gifts, friend gifts, holiday meals, holiday decorations, and whatever else you plan to spend just for this time of year.
Creating a specific holiday budget can also help you plan for your spending.
When you plan for spending, you won’t overspend on things you don’t need. Marketing is taken to the extreme over the holidays, and it can be easy to think you need to purchase something that you don’t.
With a budget, you may be able to say no more easily than if you didn’t have one!
2. Organize your Christmas things.
Before you buy any Christmas items, it’s important to organize and go through what you have.
It is so easy to see the holiday section go up in Target or Costco and want to buy a new Christmas tree or more holiday wrapping paper. Before you’re tempted, go to your attic or closet and pull out all of your holiday items.
You may have all the wrapping paper you need and all of the decorations for your home. This can help you save money and reduce clutter. If you’re always buying new Christmas decorations, you will have duplicates of so many things. Use what you have first; if you need to buy something, you can.
3. Start planning now.
Planning is one of the best ways to ensure you’re sticking to your budget and not overspending.
Every aspect of your holiday spending should be planned. It can be as specific as you want or as loose as you want. Focus on planning your meals and gifts.
Meals
Food can be a huge cost around the holidays, from parties to your Christmas meal.
Planning as much as you can around your holiday meals will help you reduce your spending.
You can plan around sales if you know what you need to get for meals. When you wait for the last minute, you may not be able to use a sale and will be forced to buy things at full price.
Planning ahead also means you won’t be waiting last minute to buy what you need.
For example, if you know you will need certain goods that have a longer expiration date, like flour and canned goods, you can be on the lookout for those items when they go on sale. You’ll be able to save money and check something off of your list.
Festive Meal Plans with a Holiday Twist for About $50 | Budget-Friendly Recipes
Gifts
Gifts are another huge financial aspect of the holidays.
Families, friends, and co-workers exchange gifts, and this can be costly. Don’t feel obligated to buy for everyone.
Even though Christmas is a period for exchanging gifts, you don’t have to go overboard.
Cut down on the number of people on your gift list. If this feels awkward at first, be up front about your plans. Other people are likely in the same boat, and may appreciate that someone else brought this up.
Instead of purchasing unique gifts for each person, consider arranging a gift exchange or name-drawing. Suggest going out for a lunch instead of exchanging gifts, so people know you value them, but you eliminate the pressure of buying and planning more gifts.
For those people you decide to give to, make sure you’re within your budget. Doing this will help you not overspend, find things on sale, buy your gifts early, and avoid last-minute shopping.
Just like groceries, gifts can go on sale. If you plan your gifts, you can buy them when they’re on discount. This will also help you to not be stressed out finding a gift last minute. You know last-minute shopping can really hurt your budget!
4. DIY gifts.
Consider a DIY gift if you have a small budget for the holidays and can’t afford to buy a gift for your co-workers and friends.
DIY gifts can be more personal, and they don’t have to break the bank. If you are talented in something, consider using that talent to make a gift. If you don’t have a skill like that, go online and see the unique holiday DIY gifts that you can make.
Things from custom paintings to vinyl stickers are great gifts if you have that skill. You can make something really special and for a low cost. If you aren’t crafty or don’t have time, you can bake cookies or even make holiday themed Rice Krispie Squares and out them in a lovely tin.
If you have extra jars around your house, you can fill them with homemade jam, hot chocolate, or even a brownie mix. Even a small gift like that will put a smile on someone’s face!
5. Buy after the holidays.
A great way to save on holiday decor is to buy these items after the holiday. They will be marked down, and it’s a great way to buy more wrapping paper if you use all of yours or if you want to upgrade your decorations.
Avoid buying these things during the season because they are marked up.
However, if you need a new fake Christmas tree, buy it after the season, and you can save a lot.
This even applies to gifts. If you know what someone wants for the following year, buy that item when it’s on sale.
The summer is a surprisingly good time for Christmas spending because there tend to be a lot of sales. You have to be organized, and this goes back to planning your holiday budget.
Christmas Spending: Remember What the Holidays Are Actually About
It can be easy to get wrapped up in the celebration of the holiday season and let our Christmas spending get out of control.
We want to give gifts, host parties and have an amazing meal. While these are fun, we must remember why we celebrate the holidays. However and whatever you choose to celebrate, this time of year is filled with joy and family.
Spending time with our loved ones is the most important thing to do over the holidays. The gifts and food make the time even more special, but not having a perfect gift or ten-course meal won’t ruin your holidays.
Be mindful of your budget and what this season really is about.
Editor’s note: This article was originally published Nov 4, 2022 and has been updated to improve reader experience.
