Set a Christmas budget (Day 3 of 31 days to take the Stress out of Christmas)

This post is part of a series – “31 days to take the Stress out of Christmas”.  You can read all the posts in the series here.  And to make sure you don’t miss a post you can subscribe to have every post delivered to your inbox, or follow me on facebook.

Many of you have commented that one of your main areas of stress when it comes to Christmas is money.  It may be that your budget is tight and adding on extras like gifts, extra baking, decorating, events, pictures just really puts a strain on you and your wallet.  Or maybe it is that things aren’t necessarily tight BUT you are a spender and love to shop/give gifts and you so you overspend and face the stress in January when you get the credit card bill or at the end of December when you can’t quite pay the bills due on January 1.  Regardless of what your families financial situation is setting a budget when it comes to Christmas is necessary and a huge stress relief to us all.

I love what MoneySavingMom has to say about setting a budget for Christmas: “A budget can best one of the best ways to save your sanity and simplify your Christmas. Knowing exactly how much (or little!) you have to spend, will help you to plan your gifts and your shopping accordingly. And will guarantee that you don’t begin the new year with the burden of credit card debt from your holiday spending.  A budget gives you freedom. It lets you be in control of your money — not the other way around. You get to choose how much you’re going to spend and then be intentional about spending it.”

So how can you take the stress out of Christmas when it comes to money?

1. Set a budget

How much will you spend on Christmas this year?  A good way to figure that out is to think through what you have done in past years.  If you use online budgeting software or a checkbook or keep receipts, you could even go back through some of those and get a general idea on what you spent on Christmas.  But if you don’t have a black and white way of tracking it just think through it.  And if you need to, go back to day 1 and read one of the main ways to have a stress-free Christmas is to SIMPLIFY!  I am not talking about elaborate gifts for every extended family member – think of ways you can simplify in what you spend.  How much do you spend in all these areas – family pictures, do you go to a special event during the holidays, cards, postage, donations, decorations, and then gifts?  Take some time today or this weekend and write out a rough estimate of how much you have spent in past years/think of how much you will spend this year.  Or maybe you already know I will only have “$X” amount of money to spend and you need help coming up with ways you can stretch that money for people on your list – we will talk about simple and inexpensive gifts and décor later on in this series.

Here’s some free printables you can you use (click picture to be taken to link to print)

If you are an online organizer person (like me) here’s a downloadable template for a online budget spreadsheet.

This is no way an exhaustive list.  If none of these fit what you want or need, do a search on Pinterest or google for free printable Christmas budget planner sheets – there are tons out there!  Or just make your own in a spreadsheet or on a piece of paper.

2. Figure out where the money you need will come from – and start to save!

So you have thought through how much you will need extra for Christmas this year – where will that money come from?  Do you have extra in the bank right now?  Will you get a holiday bonus at work that will cover it?  Do you have a Christmas savings account?  Or honestly you really don’t know?

Save a set amount each week starting NOW.  So for example let’s say you have figured out that you need $500 for Christmas and you don’t have it saved anywhere, there isn’t any extra in your bank account, and you don’t get a holiday bonus.  (I know that figure may be way high for some or way low for others – so you figure out what your amount is).  Starting today there are 12 Friday’s until Christmas or 11 weeks and Christmas is on that next week on Thursday.  Divide $500 by 12 and you get $41.66.  So if you get paid every week you would need to save $40-45 each Friday and you would have about $500 by December 19.  If you get paid every other week you would need to save $80-90 each paycheck and so on.  Breaking it down like that makes it seem a lot more feasible.  Now in reality I hope that you won’t be waiting until December 19th to spend that money but would be starting even now to start buying or doing things on your list so you would be gradually spending that money up until December 19.  Get an envelope or a little coupon folder and start pulling out cash each week from your paycheck and “depositing” it in your Christmas envelope.

Set up a savings plan for the whole year or maybe for half the year.

If some of you came up with a Christmas budget $1000 or more you are going to find it hard to be able to save that amount of money between now and Christmas.  And for others of you $40 a week is too much out of your paycheck because things are really tight.  I am not sure what to tell you to do about Christmas this year – maybe have a yard sale/list some things on Craigslist to make some extra money?  Make some homemade gift baskets or baked goods and sell them?  Or just decrease your budget to the point you can afford?

But I would love to encourage you to find a year savings plan that you can start after Christmas in January for NEXT Christmas.  There are many different ways and plans out there.

This one is a set dollar amount per week in $10 increments so you could save $10 a week, $20 a week or you can customize it.  And it ends the week of Thanksgiving so you then have all the money saved and can do all your shopping on Black Friday weekend or in the first weeks of December.  And it frees up the amount you had been saving each week to maybe extra grocery money for the month of December.

You could save according to this 52 week plan where you increase the amount you save by $1 each week – so $1 on week 1, $2 on week $2 all the way to $52 on week 52 and you end up with $1,378 saved by the end of the year!

I have not heard of this plan before but it sounds really neat!  Could use the gift cards to buy gifts or give the gift cards as gifts if you typically have people that you buy gift cards for.

Come up with a plan that fits your income and your needs and make a New Years resolution that you will save according to that plan for next Christmas.

3. Stick to your plan/budget

If you do all this work on figuring out how much you need, how to save it, and then save it… only to blow it completely on Black Friday on something not on your list or in buying way too many gifts… you have just defeated the whole purpose.  (And probably caused some a lot of stress for yourself later on in December.)

So whatever budget you come up with ($20 for your in-laws gift or $50 for each child) STICK TO IT!    Don’t let the sales that are about to start in a few weeks get you off track.  If you are “spender” maybe find someone like your husband or close friend to help keep you accountable in what you are spending for Christmas.  No one remembers every gift they received – so don’t allow the “spending” part of Christmas to overtake when traditions, time, and fun family activities is what is usually what is remembered.  Just try it – ask your kids/husband/family member what you gave them last year for Christmas.  Or ask them what was their favorite thing about last Christmas.

I will share a bit more about what I do in some later posts as far as budgets and gifts.  And we will talk more about gift lists, how can we simplify gifts, how you can homemade gifts and more in coming days.  So today I just want you to think about the budget part – how much will you have to spend/do you need to spend and how will you get that money.

I would love to hear from you in the comments – what is your Christmas budget?  How do you save for Christmas?  How do you determine how much will you spend?