Your Christmas Spending Plan
We’re fast approaching that time of year when Christmas shopping moves into high gear, typically kicked off by Black Friday sales the day after Thanksgiving. According to a consumer spending survey by the National Retail Foundation, the average holiday shopper will spend $749.51 this year on gifts, cards, decorations, etc.
I would venture to say that $1,500 per couple is more than most families can actually afford. If that’s true, it means that a lot of people are going into debt with their Christmas spending and then taking months (or possibly longer) to actually pay for their purchases.
Personally, I like knowing the gifts given by and to my family are actually paid for! You probably prefer that as well. But the reality is that this can rarely happen without intentionally setting and following through with a budget.
Here are some category ideas to get you started:
• gifts (include shipping costs)
• charitable giving
• cards & stamps
• food (for get-togethers or extra baking)
• decorations (Don’t forget the tree!)
First you need to decide on a total amount you can reasonably spend. Don’t base it on wishful thinking, but your present reality. Let go of the pressure of feeling like you have to buy a Christmas gift for every person in your life. By doing so, you might just give those people the permission they need to do the same! If you really want to give a gift but can’t afford to buy one, make something yourself or offer a service.
From there, apportion it to your various categories and then break it down even more within each category if you can. For example, if you budget $500 for Christmas spending and $300 of it will go to gifts, figure out how much of that amount will be for your spouse, your children, extended family, etc. If you’re hosting a Christmas party, budget for that event separately from your baking.
Once you’ve set up your budget, these two steps become vital:
If you don’t track your expenses according to the categories and amounts you’ve set, it will be impossible to follow your spending plan as well as assess any changes you need to make for next year’s budget. Even if all your shopping is already done (Wow! Good for you!), it’s a good idea to make a record of it for evaluation.
At the very least, keep track of it on paper. It’s so much more fun with a free printable like this one:
If you use a cash envelope system method of budgeting, consider organizing your Christmas cash by categories rather than just lumping the entire sum into one envelope.
Here is my system for this year’s Christmas gifts:
Behind each person’s name goes an index card (with gift ideas on front and a list of purchases with a running total on back), the budgeted cash, and receipts. For any online purchases, I will simply remove the cash and deposit it into our account.
Stick to it!
Between Black Friday, Cyber Monday, and the deals that typically run from the middle of December all the way to Christmas Eve, it is so tempting to spend more than your decided amount. You may see something go on sale for an amazing, hard-to-resist price, but you have to stop and evaluate if it fits the plans you wisely made ahead of time. That’s not to say there can never be exceptions, but don’t let November and December impulsiveness create January remorse.
With some diligence in plotting and executing a spending plan, you can awaken on December 26 with a smile on your face and nothing on the plastic. Doesn’t that sound glorious?