This year we made some big changes for the better in the way we manage our money. We actually started living on a budget. In turn that’s helped us pay off my van, two student loans and our phone. It’s also helped us make big progress on paying off our credit cards. Christmas is the most wonderful time of year but it can also be a budget buster. It always was for us in the past because we had no plan. We overspent at Christmas just as we did during the rest of the year. I was determined to change that. This year I came up with some simple strategies to stay on budget and still have a meaningful and wonderful Christmas. Here’s some easy ways I came up with a Christmas financial plan that doesn’t break the bank and a free printable to help you do the same.
Make a Total Christmas Budget
This will be the total amount that you will spend on everyone you will be buying gifts for from immediate family to teacher gifts. Amounts will vary from family to family. The important thing is to set an amount in cash that you can get your hands on in cash by Christmas Eve. There is no joy in going into debt to buy people presents. Setting this amount may involve having hard conversations with yourself or your partner about what type of gifts everyone is getting this year. Maybe you’ve been saving for Christmas since January. Perhaps you are waiting on a Christmas bonus like we do sometimes. Maybe you are setting aside amounts from a certain number of paychecks before Christmas. Wherever the money comes from, there is a finite amount of cash you will have available to spend. That is your total Christmas budget, your guideposts to avoid giving yourself the unwanted gift of Christmas debt.
Make a Per Person Christmas Gift Budget
Now that you have your total Christmas budget it’s time to allocate that money across your Christmas list. You can use the free printable below to write out your list of who you will be buying gifts for and how much you want to spend on each person. Your total Christmas gift list should equal no more than your total Christmas budget. How you allocate that budget is entirely up to you. I will be honest in that within reason our kids take up the bulk of our Christmas budget. However, we gently guide their wishes so that it doesn’t break our budget or doesn’t leave a less than reasonable amount for everyone else on the list. Once we know the set amount for the kids we start allocating the rest for everyone else. This includes family, friends, teachers, and others such as hairdressers and cleaning services. How much you spend on each person is entirely up to you. You can even leave a little buffer for those last minute gifts or in case you forgot anyone. The point is to set gift amounts that do not exceed your total budget.
Have a Plan
Once you decide how much you want to spend on the people on your list, now comes the hard part. Deciding what to get them. My advice is to fill in the free printable with not only the amount you want to spend on the person but what you want to get them. There are few easier ways to break a budget than impulse spending because you have no plan. Browse catalogs or online for ideas but come up with one or two concrete gift ideas for each person. (It’s always good to have a back up plan!) Do this before you even enter a store or click online to Christmas shop. If have a budget and a plan you are way less likely to impulsively grab Aunt Helen a $50 pair of unicorn house shoes and blow your budget.
Do Your Homework
Just like when we were in school, it pays (or saves) to do your homework when Christmas shopping. Even if you’re not a die hard Black Friday shopper, watch for online deals or for Cyber Monday sales. If you miss Black Friday or Cyber Monday, still take your completed list and check the prices of the items at a few different stores. There’s even apps that will do it for you. If you’re really on the ball you can watch for sales throughout the year or watch for Christmas in July. You don’t have to spend hours (Goodness knows I don’t!) but a few minutes of research instead of just purchasing at the first store you click or visit can save a lot of money on your Christmas budget.
Don’t Be Afraid of Gift Cards
Gift cards can get a bad wrap (no gift giving pun intended) about being impersonal. The majority of the people, however, love being able to treat themselves at their favorite store or restaurant or salon. There is no more guaranteed way to stay on a gift giving budget than to give a gift card. Budgeted $30 for someone? Grab a $25 gift card and spend $5 on a cute bag and some treats to go in it. Boom. Drop the on budget mic. I do gift cards for my college age niece and nephews and pair it with a laundry basket or fabric storage box of dorm room trial size essentials and treats. Teachers may love handmade items from students but they also love gift cards. I buy packages of $15 gift cards for coffee, ice cream, or movie tickets and divide them among the teachers. I package these in cute bags with small classroom essentials or sweets for the teachers. One year I even made a batch of cost effective lavender and mint hand soap from this recipe from Little House Living. Handmade gifts can be both a budget friendly and personal touch to add to a gift card. Gift cards may not work for everyone on your list but take a look at who would appreciate one and help yourself stay on budget with set amount gift cards.
Everyone’s Christmas budget is as different as the family and gifts on their Christmas list, but most people can agree that they don’t want to wish they hadn’t spent so much come December 26th. With a little planning and mindfulness you can give great gifts and stay on budget too. What’s your best Christmas gift giving budget tip?