How to Not Go Broke at Christmas

It’s the most wonderful time of the year! I absolutely LOVE the holiday season! It’s filled with so many good things, like family time, holiday décor, hot cocoa, candy canes, happiness, Christmas music, and presents. While I enjoy gift-giving, I want to point out that it can get out of hand very quickly. I want to give all the people I love, family and friends, everything they want. Unfortunately, if I did that I would probably be left with a penny to me name. That’s why I want to share with you tips to ensure you don’t go broke at Christmas!

Set a Budget for Christmas

I have spoken about the importance of having a budget countless times; however, a budget is pointless if you don’t update it constantly for every additional expense that you have. You need to know how much money you are willing to spend on Christmas gifts in order to plan for those costs. Determine a total amount you are willing and able to spend on gifts and then divide that accordingly for the people you would like to give gifts to. Keep in mind that you should set a realistic budget; don’t spend money that you don’t have.

Save Ahead of Time

It can be difficult to find the money to spend on Christmas gifts without sacrificing a different expense line in your budget for the month, so my suggestion is to set aside money ahead of time. You can do this in whatever way works for you. Some people prefer to set aside a little money each month throughout the whole year. Some people prefer to buy gifts throughout the year and save them for Christmas to spread out the spending. Some people start saving in the couple of months leading up to the holiday. Whatever way works best for you, just try to plan ahead as much as possible to avoid financial stress.

Look for Deals

Black Friday may be absolute mayhem, but you can truly find amazing deals on all sorts of items at stores. If you’re not one for dealing with the craziness in public, like me, then you can enjoy the sales from the comfort of your home by shopping online. You can find “Black Friday” and “Cyber Monday” deals beginning the day before Thanksgiving all the way through the Monday following Thanksgiving. I actually saw a bunch of websites that continued their “Cyber Monday” deals into Tuesday, even.

Ask Not to Exchange Gifts

If you’re really struggling to find the money for gifts for everyone, it is more than okay to ask to not exchange gifts. I’m sure your loved ones will completely understand and they wouldn’t want to make you uncomfortable or have you spending money you don’t have.  As an alternative to gift-exchanging, you could always suggest a creative idea such as secret Santa, recipe exchange, or doing a group activity together.

Utilize Reward Points

If you have a credit card that offers rewards points, utilize them for gifts around the holidays. This takes the burden off your bank account and you are utilizing money earned from purchases already made. There are various ways to do this: turn your points into gift cards, use your points to purchase gifts or apply your points as a credit to your bill. This can really help save a lot of money. Additionally, make sure you are taking advantage of earning cash back, whether through your credit or through sites like Ebates (click this link to sign up and earn bonus cash with your first purchase).

Christmas may be the most wonderful time of year, but make sure that you enjoy it wisely and don’t overspend. You shouldn’t go into debt to buy gifts for yourself or other people. Spend only what you can afford and you’ll enjoy a stress-free holiday season!

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About Courtney

Hi everyone! My name is Courtney and I run Your Average Dough. I live in Westchester County, NY. I am currently working as an accountant for a non-profit; however, in the past I worked as a financial analyst for a Fortune 100 company and, prior to that, as an auditor with one of the Big 4. I have a bachelor’s degree in accounting, I have a MBA and I am a CPA.
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2 Responses to How to Not Go Broke at Christmas

  1. Some great tips here! We opt to save up throughout the year for gifts and then stick to our budget once Christmas comes. We have a large family and end up having four Christmases each year. In the past few years, we’ve had more luck with just getting together to share a nice meal or going out as a big collective family out. One other thing that we do is try to stick to only a couple of gifts for our kids since they still get so much from all the relatives. We also try to prioritize experiences over material things.

    One thing that I haven’t had much success with is getting relatives on board for contributing to the college funds though. Just have to keep trying.

  2. Keith says:

    Great stuff, Courtney!

    Selena and I quit giving each other gifts a number of years ago. Really no need. We’ve also gotten a handle on spending on others. We budget each year and don’t go over the amount.

    We don’t actually save for Christmas, but we’ve at a position where we don’t have to. We just make a point to spend only so much and not any more.

    I remember the days that we would go into debt buying for our families and kids. Don’t miss those days at all.

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