Budgeting for (Next) Christmas

Budgeting for (Next) Christmas

You are probably wondering why I am posting about budgeting for next Christmas since it is Christmas today.  As I am writing this, the holiday season is upon us, excitement and celebration is hanging in the air and everyone is getting ready for family gatherings.  If you are like me you tend to forget Christmas happens at the end of December…each year.  No, that’s not right, I remember Christmas.  I love the lights, the holiday cheer and the family gatherings.  I just forgot (or ignore the fact until the last minute) that I will be buying my loved ones gifts and those gifts are going to cost money.  Each year I try to make up for what I have spent in January.  This is a stressful way to start the New Year!  While it is a impossible to start planning for this Christmas, this is the perfect time to start planning for next year.

Sales on Holiday Décor.  The first step is to take advantage of the deep discounts of Christmas and holiday décor immediately following Christmas.  Stores put all of their holiday décor is on sale to make room for the next season of items.  If you have money available, this is the best time to buy decorations.  I will be out finding some deeply discounted decorations that I will be able to use year after year.

Saving for the Holiday.  The best time to start saving is in the January or February.  The more time you give yourself, the less money you will have to save each month.  First, how much did you spend on Christmas last year?  Add up the costs of all of the gifts, new clothing, fancy meal ingredients, cards, travel, etc.  What is your total?  Use this total as an estimate for what you will spend this year.  Note: Hold on to this list, I will provide you tips on how to lower the cost later in the article.

Now comes the hard part, saving.  Let’s say we start saving in February and end our saving in November.  Take your total amount and divide by 9 months.  For example, if I spent $1,000 last Christmas, I will be saving $112 a month.  Saving $112 a month is a whole lot easier than trying to find $1,000 when my bill is due in January!  Now that you have you monthly number, you can create a personalized saving account for your holiday savings.  Set up your automatic withdrawal for your monthly amount and take a break!

Reduce Your Spending.  The next step is try to reduce your spending this Christmas.  Don’t worry if you are saving too much money right now.  You can always move that money to a different savings account after the holidays, such as your emergency fund or new car fund (which is my current mission).  Pull out your list of expenses from last year and let’s go through the categories.

Gifts.  List out all of the people you purchased gifts for, is there anyone else you need to add to this list or take off the list?  Now start brainstorming gift ideas for each person and write it down.  This way as you are shopping throughout the year you can have your eye out for a gift that is hopefully on sale.  The goal is to finish all of your gift shopping before December.  If you have gifts left to buy, Black Friday or Cyber Monday are great days to pick up gifts at a deep discount.  Just don’t get pulled into the rush to get to the stores when they open on Black Friday.  I have found practically empty parking lots and malls in the afternoon on Black Friday.

Clothing.  What types of new clothing with you and your family need for the holidays?  Make a list and shop sales leading up to the holidays.  This way you don’t find yourself fighting traffic and lines in malls to find a new dress the night before a party!

Travel.  It may be hard to find savings for your travel needs since your mode of travel may be inflexible.  You may have to fly to family across the county, drive a few hours or you are staying local.  If you are flying, make your holiday plans as early as possible.  This way you can book flights early to take advantage of lower prices and choose flights on days or times that have lower prices.  I have found that flights on Tuesday and Thursdays, early morning or late at night are the most affordable.

Meals.  If you will hosting family or bring dishes to gatherings, you will need to plan for these dishes.  These should be accounted for in your weekly grocery shopping, using any and all coupons for the ingredients.  Planning for these dishes with your weekly grocery shopping will save you time, which is very limited during the holiday season.  You should plan you dishes a few weeks in advance in order to be prepared with the appropriate coupons.  You will be able to buy non-perishable items in advance when they are on sale.

Holiday Cards.  I love holiday cards, holiday cards with pictures of the family on them are my favorite.  These tend to stay on the fridge throughout the year.  You should start planning for your holiday cards in the fall.  Start picking out some photographs you would like to go on them, this way if you find a gap – a photograph you are missing – you have time to take it.  Search online for a company to print and mail your cards.  Be sure to check Groupon, or another app in your area, for a discounted service.

I hope this list helps you prepare for your next holiday season.  The season is meant to be about celebration and family; being prepared for the holiday season will help you stay low stress and spend the most time on what really matters.  Merry Christmas!

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