It’s Christmastime! It’s the season of giving, and most people don’t want to be perceived as a Scrooge. This is why the Christmas season is also a time when many families throw caution to the wind and make financial decisions that are detrimental to their overall financial health. The good news is that with a bit of focus and intentional financial discipline, families can experience a wonderful Christmas without breaking the bank.
With this in mind, here are 10 practical tips for surviving the holidays without going broke.
1. Establish a Budget for Christmas Spending. Make a quick list of everyone you feel you need to “gift” this Christmas. Then, take a look at the state of your finances, and decide how much you can afford to spend on Christmas gifts. Set this amount as your limit. Write it down. Finally, take a look at your gift list again, and begin making some decisions on specific dollar amounts to allocate to each person. Remember, not every gift needs to be one that has been purchased.
2. Stick to Your Budget. Christmas tends to bring out the best in people in terms of feelings of generosity toward their loved-ones. But, once you’ve set your Christmas gift budget, stick to it. Don’t budge. Once you reach your budget limit, you’ll need to say, “That’s all. No more.”
3. Resist the Urge to Buy on Impulse. One of the biggest reasons people break their Christmas spending budgets is that there is a strong urge to buy on impulse. For example, we might go online looking to buy a certain gift for someone. We find the item, click to add it to our shopping cart and then our eyes drift on the page to the one-hour-only specials being offered. My goodness! Look at that! Turnip Twaddlers are 75% off! It’s too good of a bargain to pass up. After all, they’re nearly free! So, we click to add it to our cart. And we end up buying something we wouldn’t have purchased otherwise. I don’t know how to completely avoid the urge to buy on impulse. But what we need to remind ourselves of is this: retailers have a vested interest in trying to get you to buy more. They’ll advertise, market, and display with their goal in mind to create that impulse within you to buy, buy, buy! Remember, they aren’t interested in your budget. They’re interested in selling their products.
4. Don’t Buy Yourself Anything. Reportedly, the majority of Christmas shoppers end up buying items for themselves. Many don’t take this into account when they set up their Christmas spending budgets. So, either be smart from the start by including an amount for purchases you want to make for yourself or simply choose not to buy yourself anything this year.
5. Shop for Bargains. During the Christmas season, retailers often discount items (but not everything, mind you). Help stretch your dollar by being a comparison shopper. Take advantage of sales. Lots of bargains can also be found online, and keep in mind that you might actually find your best price there. But, one caveat: often times, online retailers may give you a real bargain, but charge horrendous amounts for shipping, and in the end, you might even pay more for that item online than if you had purchased it locally. Finally, there are lots of non-name-brand items that are made with decent quality. So, even if a purchase is not as “cool” without that popular name-brand, non-name-brand items can provide good value and choices for saving some money.
6. Pay with Cash, Check, or a Debit Card. Give the credit cards a rest this Christmas. Or, as a last resort, only use credit cards for items included in the Christmas spending budget and pay off amounts charged for Christmas gifts the following month, so as not to incur any additional finance charges.
7. Think Creatively. When it comes to gifts for Christmas, do some creative brainstorming on ones you can give that won’t cost you money, or at least at minimal cost. What can you make or bake that would be meaningful? What service might you provide? One father, for example, gave a simple printout of coupons to his son for Christmas, entitling his son to forgo certain expected household chores, which Dad would do for him instead. The son could use the coupons whenever he wanted and when the coupons had been used up, the son was expected to comply with the rest of his responsibilities.
8. Remember, the Best Things in Life Are Not Things. This tip follows closely with the “Think Creatively” concept. Remember that more than “things,” people yearn for close relationships and the gift of your presence in their lives. So, for example, perhaps one gift to your family might be to schedule monthly family nights where everyone can hang out together and enjoy each other’s company. In this scenario, each family member can take a turn making a decision regarding what the activity for the evening will be for the current month (like a game night, watch a movie together on the television, go out for ice cream, etc.)
9. It’s Okay to Cut Back. If your family typically goes to great lengths in celebrating Christmas, it can be tough to decide to cut back for the financial health of your family if money is tight this year. But, understand that your family will survive if you do. There will always be a “next” Christmas, and perhaps next year you can move back into a more “regular” Christmas experience for your family. Make the most of what you are able to do this year. Strive to keep family morale high and place the focus on “the reason for the season.”
10. Think Through Other Holiday Expenses. There are a lot of other little Christmastime-related expenses that typically aren’t considered. So, take some time to make a list of what those expenses are and how you can save by cutting back or doing things differently. For example, perhaps you’re used to making Christmas dinner for your entire extended family and over the years you’ve provided all of the food and fixings. But, there’s no shame in sharing the costs by having other family members bring an appetizer or provide other parts of the meal. Or, choose to buy a less expensive Christmas tree this year. Or, write handwritten notes instead of buying Christmas cards or send Christmas emails instead of sending out Christmas cards. The idea is to think through your Christmas-related expenses and make choices in the best interests of your family’s financial health.