How To Budget for a Debt-Free Christmas

by CashTime Loan Centers

Christmas is coming…are you ready? While you might think it’s too soon to start thinking about what to get whom, it’s really never too early to start saving and planning for the biggest purchasing holiday of the year. Too many people go into debt over this holiday every year, but it doesn’t have to be that way. With just a little preparation and planning, you can have an enjoyable holiday that you manage with a spending plan, and don’t end up racking up debt that takes the next several months to pay off. Here are a few tried and true tips for having a wonderful debt free Christmas:


Start saving soon

If you want to keep your holiday spending off your credit cards (yay, you!) then you need to craft a savings plan that gives you enough cash by the time you’re ready to go shopping (hello, Black Friday!) so that you’re not tempted to whip out that plastic you’ve been trying not to use. Review your budget to see how much you can realistically put aside every paycheck for your holiday fund. Whether you start in January or June, decide what you can put away without sacrificing on necessities (like paying your bills).


Decide where your money will go

Try the Dave Ramsey Christmas budget plan, using the zero based budget philosophy of income minus outgo = zero. In other words, you start with your monthly income, deduct your fixed expenses like rent or mortgage payments, clothing, utilities, and groceries, and other expenses that can vary like phone bills. Then you assign each dollar of your income to the various categories until you reach zero, and every dollar has a task. If your expenses exceed your income, try reducing some categories like food by using discount coupons, shopping sales, and buying in bulk, or reducing transportation costs by ride sharing. Take the savings from these categories and funnel them into your Christmas budget. To bump up your savings faster, pick up a side hustle if you can, and dedicate that income to your Christmas fund. Once you’ve decided how much you want to put away, divide the total by the number of weeks or months left before Christmas, and you’ll know exactly what you need to save every week.


Think outside the (gift) box.

Who says you have to buy every gift at a store? Are you handy or crafty? Try making some homemade gifts this year. If you’re not so crafty, try looking online for simple DIY gift ideas. You don’t have to spend a lot of money to make a gift special. Not sure what to get your friends and loved ones? Try observing what they get excited about, talk about a lot, or use a lot. Is your daughter always borrowing your bath robe? Maybe it’s time to get her one of her own for Christmas.


Shop clearance racks and buy in bulk

Is there something several people in your life would like? Consider buying that item in bulk. Better yet, check out the clearance section for items that come in multiples. If you can get a deal on a case of scented candles, go for it! You can always personalize each one for the gift recipient. Add a teacup and some specialty teas for Aunt Martha, a few hot cocoa packets, some mini marshmallows and a holiday mug for mom, a book of poetry for your best friend, a joke book for that Secret Santa coworker gift, and so on.


Try a gift exchange

If you have a big family get together every Christmas, consider doing a gift exchange rather than purchasing a gift for each individual. Put all the names in a hat, and have every person pull the name of someone else, then they purchase a gift for just that person. This way, everyone has at least one gift under the tree, and you’re not stuck buying gifts for everyone.


Christmas is about the joy of spending time with family, the thrill of giving, and being thankful. When you can wake up the day after Christmas and breathe easy knowing you won’t be paying off your holiday spending until next summer, it’s a great feeling! Christmas does not have to mean going into debt. With a little planning and discipline, you can end the year on a high note and not carry any new debt with you into the new year. Now that’s something to be jolly about!