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How To Survive Christmas On A Budget

Christmas is meant to be a time for joy, festivity, and spending time with your loved ones. However, for many people, it can also be a stressful time of year, especially when it comes to money. If you’re not careful, you can easily overspend and find yourself with a load of credit card debt in the New Year.

Luckily, with a bit of planning and thoughtful spending, you can avoid the money drama and still have an amazing festive season. Here are some simple ways to survive Christmas on a budget and make sure that you’re not regretting your spending once the tree comes down and the decorations are packed away.

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How To Survive Christmas On A Budget

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Set A Budget (And Stick To It)

If you want to avoid overspending during the festive season, setting a Budget is absolutely essential. Before you even start your Christmas shopping, you should take some time to write down all of your expected expenses so that you have a solid idea of how much you are going to spend on Christmas this year.

It’s really easy for small extra purchases here and there to really add up when it comes to Christmas, so try to be thorough with your budget and capture everything that you’re likely to spend money on.

Some expenses to consider for your Christmas budget include:

  • Gifts (make sure you capture everyone you intend to buy gifts for this year plus how much you intend to spend).
  • Extra food and groceries.
  • Christmas party and/or hosting costs.
  • Christmas tree, decorations, and lights.
  • Traveling costs if you plan to go visit family (this could include gas, flights, accommodation, and extra food).
  • Christmas cards.
  • Christmas outfits and family photos.
  • Wrapping paper, tape, and ribbon.
  • Donations.

When planning your Christmas budget, it’s a good idea to add some extra cash in there as a buffer for any sneaky expenses that you forget or overspend on. I like to add an extra 10% when I’m planning my Christmas budget as there is always something that I forget to budget for.

Once you have your budget planned, do your best to stick to it. If you find yourself wanting to make extra purchases that don’t fit into your budget, ask yourself if they’re really essential. If the answer is no, don’t buy it. If the answer is yes, think about how you can reshuffle your budget to cover the extra items without going over your total budget.

While it may feel like you’re depriving yourself at the time, you’ll be glad when Christmas is over and your bank account and credit cards are still in good shape.

Set Expectations

If you have a large family, a lot of friends, or regularly extend your Christmas giving to others outside of your family (eg. teachers, business partners) the cost can quickly get out of hand.

If you’re trying to cut back so that you can survive Christmas on a budget, one of the most important things you can do is have an open conversation with your family and friends to set their expectations, especially when it comes to gifting.

Let them know your situation and what they can expect from you that year so that there are no unexpected surprises. If you plan to scale back on gifting or need to share the cost of hosting, have that discussion early and make sure that you are sensitive but firm on your non-negotiables.

Christmas should be about spending quality time with your loved ones, so focus on cheap or free activities, and avoid making gift exchanges the highlight of your holiday. Most people will understand if you need to reduce your Christmas spending, so set their expectations early and focus on the positives.

Make A Savings Goal

Once you’ve figured out your Christmas budget, it’s time to figure out how you’re going to fund your spending. Setting a Christmas savings goal is a great place to get started.

The easiest way to set a Christmas savings goal is to take the amount in your budget and divide it by the number of months left until Christmas. For example, if your budget is $1,200 and you have three months left until Christmas, that would mean that you would need to save an additional $400 per month to fully fund your Christmas spending.

When it comes to Christmas savings, the earlier you can get started, the better. For future years, consider setting up a Christmas sinking fund and starting your Christmas savings as soon as you reach the new year. By starting to save early you reduce the amount of money you need to save each month, which can make Christmas a whole lot less stressful.

Earn Some Extra Cash With A Side Hustle

If you find that money is a bit tight when it comes to the holidays, another great strategy is to earn a bit of extra cash on the side to bolster your budget.

If your job allows for overtime, consider putting in some extra hours in the months leading up to Christmas so that you can fund your holidays without the need to pile up any debt.

If overtime isn’t an option for you, there are plenty of other ways to earn some extra cash for Christmas. Consider starting a side hustle to boost your income. This is a great idea not just for Christmas, but for the rest of the year as well.

If you’re looking for some ideas to get started, check out these 6 Easy Online Side Hustle Ideas You Can Start Today.

If a side hustle doesn’t appeal to you, surveys and market research can be another easy way to earn some extra money. Respondent is one of my favorite companies for surveys. If you qualify for certain surveys, you can make over $100 per survey through Respondent.

Get Creative With Gifting

Gifting can be one of the most expensive parts of your Christmas holiday, but it doesn’t have to be. There are a ton of great ways to reduce the cost of gifting during the festive season.

Why not try out one of the ideas below to reduce your spend – just make sure to talk with your friends and family to set their expectations first.

1. Buy Gifts For The Kids Only

One of the best things about Christmas is watching how excited the kids get when it comes to opening their gifts. For many of the adults, I’m sure that this is the highlight of their day.

If you’re looking to cut back on your Christmas spending, think about limiting gifts to the kids only. This saves not only money, but stress too, and you might find that many of the adults in your family are happy to forego the gift exchange. Personally, while I appreciate receiving Christmas gifts, they’re certainly not essential and I would rather save the stress and enjoy the time with my family.

2. Buy Joint Gifts

Joint gifts for couples or families can be a great way to reduce your spend while still experiencing the joy of giving.

A thoughtful joint gift could be something that your friends or family would enjoy doing together, like a board game or shared experience. This has the added benefit of encouraging your loved ones to spend more time with each other, which is what the holiday season is all about.

If you’re looking for a great joint gift idea, check out my favorite board game. I’ve spent countless hours playing this game with my family and friends and it’s still an absolute favorite of mine.

3. Gift-Giving Games

Games like Secret Santa, White Elephant, or Hot Gift Potato can be a great way to save money and have fun at the same time.

The advantage of gift-giving games is that you can reduce the number of gifts that you need to purchase, as in most games each participant brings one gift and receives one gift.

This can be a good idea for the adults if you don’t want to forego gifts altogether. It can also be a good idea for extended family or friends, where buying gifts for everyone would end up being costly and time-consuming.

My personal favorite gift-giving game is White Elephant. The rules are simple and it’s a lot of fun. If you’re interested in playing White Elephant this Christmas, pin the rules to save them for later:

4. Get Crafty With Homemade Gifts

If you’re creative or simply like making things, a homemade gift can be a fantastic way to show someone you care. Homemade gifts can be cheap to make, but also show the recipient that you care enough to take the time to make something specifically for them.

Some of my favorite ideas for homemade gifts include:

  • Baked goods, including cookies, bread, slices, or cakes.
  • Food items like homemade jams or jellies, pizza sauces, or jerky.
  • Soap, bath bombs, lotions, and other self-care items.
  • Personalized hot chocolate jars.

Find Extra Savings

When you’re trying to survive Christmas on a budget, finding extra ways to save money on your purchases can really help you stay on track. Before you start shopping, think about how you might be able to pick up some extra savings and keep that extra money in your pocket.

Some easy ways that you can save more include:

  • Check for any unused rewards points that you might have accumulated during the year.
  • Shop online with Rakuten and get cashback from hundreds of your favorite stores.
  • Use cashback credit cards (just make sure you can pay off the balance in full before it’s due).
  • Buy discounted gift cards to use at the stores that you intend to shop.
  • Get cashback on stuff that you buy anyway with the Ibotta app.

Share The Cost Of Hosting

Having all of your friends and family together in one place can make for a magical Christmas, but it can also result in a hefty bill for all of the food, drinks, and other supplies. If you’re trying to survive Christmas on a budget, it’s crucial to avoid getting stuck with the entire cost of hosting Christmas lunch or dinner.

Thankfully, it can be easy to avoid a huge bill for hosting Christmas. Here are some simple tips for hosting an amazing Christmas that won’t break your budget:

1. Host A Potluck Dinner

Potluck is my favorite way to spread out the cost of food and drinks when my family and friends get together. Not only does it reduce the bill, but it also helps reduce the stress and planning needed to prepare a meal for a large group of people. This makes it a great choice for Christmas dinner when stress levels can already be a bit high.

Hosting a potluck dinner is simple. All you need to do is ask your guests to bring one dish each (or per couple or family) that has enough servings for all of your attendees.

You can plan ahead and allocate a certain dish or course (eg. appetizers, sides, desserts) to each guest or just leave it to chance and see what kind of tasty delights your guests decide to bring.

When I host a potluck dinner, I like to fall somewhere in the middle and let my guests know which course they should cater for, without specifying exactly what dish they should bring. This way, we always end up with enough food for each course of the meal, but there is still an element of surprise since you don’t know exactly what food everyone is going to bring.

2. Make Your Own Decorations

If you’re hosting Christmas, another expensive aspect can be the decorations – especially if you like to go all out.

While there isn’t a lot that you can do to reduce the cost of your Christmas lights, you can certainly save in other areas like making your own decorations. DIY decorations are a great opportunity to not only save some money, but to bring the family together for a fun activity too.

Check out Pinterest for some fantastic DIY Christmas decoration ideas. You can go ahead and make your decorations in advance and surprise your family with your creativity, or you can buy the supplies and make it into a group activity on Christmas day. If you have kids, I’m sure they’ll love the opportunity to create their own decorations.

Focus On The Experience

While gift-giving, generosity, and abundance are certainly common themes during Christmas, it’s important to know your limits and live within your means. While many people love gifts and vast spreads of Christmas foods and treats, it doesn’t need to be the main focus of your holiday. Instead, why not shift your focus to spending quality time with your friends and family?

If you think back to previous holidays, what is it that you remember most? For me, it’s the experiences and time spent with my family that I remember, rather than the gifts, decorations or food.

If you’re the same, why not think about introducing some new traditions to your holiday with a focus on experiences rather than spending a ton of money on less important things? I’m confident that your loved ones wouldn’t want you to overspend or take on extra credit card debt for an extravagant Christmas that you can’t really afford.

Shop The Post-Christmas Sales

If you’re not too fussed about opening presents on Christmas day, you can save a ton of money by shopping the post-Christmas sales for gifts. So many stores have huge discounts during their after Christmas sales, so if you’re happy to wait a few extra days, this can be a great way to save on stuff that you were planning to buy anyway.

Post-Christmas sales are also a great way to save on things that you could use the following year. If you’re looking for new tree decorations, wrapping paper, holiday craft items, or stocking stuffers, this is the best time to stock up as they’ll likely be heavily discounted after Christmas is officially over.

While we’re on the topic of post-Christmas sales, this can also be a good time to buy for other events coming up in the year ahead. Whether it’s birthdays, weddings, Mother’s Day, or Father’s Day, you can save a ton by shopping the sales.

Final Thoughts

Too often we get caught up in the stress and obligation of Christmas and forget that it’s entirely up to us how we spend our time and money during the holidays.

If you’re looking to spend less and survive Christmas on a budget, just remember what Christmas is really about and focus on prioritizing great experiences and making memories with your loved ones. Most importantly, don’t let the holiday drag you down with a pile of debt that you’ll still be paying off well into the new year.

With a bit of preparation, creativity, and some realistic expectations, you’ll be set to have a wonderful Christmas and start your new year on the right note without any unnecessary extra debt.

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How To Survive Christmas On A Budget


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