‘Tis the season… for tons of spending. (Falalalalalalalala)
There’s no way around it. But when you’re on a tight budget during a season of materialism, it’s really hard to stay the course and keep your wallet in check. Most importantly, it’s almost impossible to have a debt-free Christmas… or so you might think!
Christmas is a time of year when people go all out with their decorations, presents, and spending. But for many families, the holidays can be stressful because they’re juggling debt payments while trying to enjoy themselves. This article will teach you how to have a debt-free Christmas this year!
What you can do BEFORE Christmas to make sure that you have a debt-free Christmas
3-12 months ahead of time: Start saving up.
Plan your Christmas spending a year ahead of time with the help of a high-yield savings account, because it means that you have that much longer to save up. Think about it like this: if you want to save $1,000 for Christmas, if you have 12 months to save up, that means you just need $83 per month to save. In just 6 months, you would need to save up $166 per month in order to save that up.
Planning ahead makes a huge difference.
I recommend using automated savings apps like Acorns and Digit to save for you automatically without you ever having to think about it.
3-1 month ahead of time: Make a budget and make a wish list.
In our house, we stick to a budget of $100 per person in our immediate family. So that means that we need to save $600 for Christmas day itself.
But there’s also the extra traveling, other family gifts, extra food, and more. We usually add an extra $400 to the total for the spending.
From there, we fill in our kids’ wish lists as well as our own. This way, we can plan ahead for coupons, where to shop, and what we’ve already gotten.
I believe in living a life that’s true to your priorities and the right money can help get you there. It all starts by making sure your finances are on track so they don’t control you any longer! This Real Life Money Plan by Jessi Fearon is an amazing plan specifically designed to fit your life!
The month of Christmas: Stick to the budget!
There’s really only ONE thing you have to do in the month of December… stick to the budget! That’s all you’ve got to do to stay debt-free.
No saying “the kids decided that they really wanted a $400 iPad for Christmas,” no “but I only bought Bobby $34 of stuff, but Jenny got $47, we have to even that out.”
If the $100 (or whatever you decide it is) is spent, then that’s that.
OK – Now let’s get into the nitty-gritty about the ways that you can spend less and really stay on track with your spending to stay out of debt this Christmas holiday season.
Here’s how we have a debt-free Christmas with a large family.
1. Buy toys from the consignment store.
If you only have $100 to spend per person at Christmas, check out your local kids’ consignment store. They are full of great, quality toys for more than 50% off the store price. Almost every toy that we get comes from a consignment store for a number of reasons.
- Obviously, it’s cheaper.
- I don’t have to spend an hour trying to figure out how to get the dadgum thing out of the packaging!
The kids have no frame of reference about whether or not it has a box or came from a store. All they care about is that they can play with it.
2. Look for used or factory refurbished electronics.
If you have a child who wants a new Xbox or a new iPad, don’t run to the nearest Apple store or Walmart. Check out GameStop first. They sell great refurbished game systems for a great discount. Plus, they come with a one-year warranty. If, for some reason the new-to-you Xbox doesn’t work right, just return it, and they’ll give you another new one.
Apple’s factory refurbished iPads are basically brand new. They take incredible care in making sure that any of their products (not limited just to iPads) are in stellar condition before you get them. It’s a great way to save a lot of money and still get a high-quality product. (Plus, if you have Rakuten, you get a nice percentage of cashback when you buy!)
3. Shop for gifts with cash.
In order stay debt-free, we set a strict price limit for spending for each member of our family. Each person has an envelope with that amount of money in it, and every time someone buys a gift for that person, it comes from that envelope.
My husband and I have a $100 each spending limit. So when I go out to buy his gift, I take the envelope with me. I can’t spend anything more than that amount because it’s all that I have in the envelope. If gifts were bought online, that amount is still reflected on the outside of the envelope.
In addition to this, you can also try out this amazing Amazon hack! Use Shopkick when shopping online. Just by linking your Shopkick and Amazon accounts, you’ll start earning kicks every time you make a purchase on Amazon.
And if you are still looking for the perfect gift for your little sister or best friend? Have you spent too much trying to afford their favorite cardigan but have nothing left to splurge on a present? I know how this feels—checkout my favorite beauty products (Ipsy subscription). I was able to create stylish looks for everyone on my list without spending too much penny on my pocket.
4. Invest in experiences instead of gifts.
A few weeks ago, I read a post (I can’t remember where) about how this woman’s children were so excited for their gifts on Christmas morning, and then they didn’t get played with ever again. That really struck a chord with me.
What does my son talk about most? The places we went, the things we did, the people we saw. Not his toys. My mind was blown by this realization.
So this year, we’re not going to get our kids toys.
They’ve got overflowing toy bins as it is! This year, we’re spending our Christmas money on things like memberships to our local zoo, visiting family, and having adventures that (we hope) they’ll remember fondly for a long time. In addition to this, you can even use apps like OnMyWay when you’re traveling. You get money for every mile you drive without checking your phone! Even if it’s just a few pennies, it’ll accumulate to earn you a couple of bucks every time you travel with your family! In addition to that, OnMyWay will give you discounts on various products on Amazon, too!
Their big-ticket gifts are going to be football jerseys from eBay that they’ll be able to wear for at least 2 years (and then they’ll get passed on to the next younger brother). This, admittedly, might sound extravagant, but we’re crazy football fans here, and our boys have picked up on that energy. Plus, at eBay, we get the factory seconds that have a missing stitch somewhere in the hem (that I still can’t find) for $12 each.
5. Set a max limit for the budget and stick to it!
I’ll be completely honest with you on this tip to stay debt-free. Tough love here, but this is for your own good. If money is tight and you really can’t get into more debt or get more stuff, then set a low budget and stick to it.
Make your budget something that still lets you get something nice for each member of your family, but once they hit their max, they don’t get any more gifts. When it comes to groceries and food preparation, it’s also important to set a grocery budget according to what dishes you plan on making and how many guests you’ll be having. If you’re in need of help with your grocery budgeting, you can learn more about the mistakes you’re probably making with this
Let’s say my max budget is $100 per person in my family. That’s still $500 to spend in total, which, to me, is a lot of money. So we have a hard limit of $100. Under no circ*mstances are we to exceed $100 per person.
My husband wanted a PS4, and that maxed out his Christmas budget (bought it from a friend… we got lucky with that one), so he doesn’t get anything else. My oldest son wanted a Razon Scooter and that gave me an extra $30 to buy him a cool helmet and some small plastic army men to go along with it. My youngest 2 are young enough that Dollar Store water guns and a new stuffed animal are still the highlights of their lives, so I won’t even need to meet their limit of $100 per person.
6. Make family Christmas parties and work parties a no-buy occasion.
I don’t know about you, but we have at least 4 different family Christmas parties to go to (excluding any parties for work or friends)! Gifts for Pollyannas and keeping track of everyone who you are supposed to get gifts for is stressful and really expensive!
Imagine if, for each party, there was a $20 limit per person. That might not seem like much right off the bat, but some quick math turns that “small” $20 into $40+ per party. For 4 parties, you’re looking at $160 at least!
Which is why I always talk my family into doing no-spend gift exchanges.
This is a win-win-win for everyone: win for the giver (getting rid of stuff at home) – win for the wallet (saving money) – win for the receiver (getting a fun gift).
Have you heard of White Elephant games? I’m sure that they have different names all over the place, but the general idea is that everyone brings a random present from home that they didn’t buy, then numbers are drawn, and gifts are opened. You can “steal” someone else’s gift if you want to as it goes on, and it’s a lot of fun.
Half of the fun of this is seeing what kind of stuff gets brought from home and wrapped! Plus, it’s a great way to re-gift that fruitcake from the last Christmas party (just make sure that it wasn’t this side of the family who gave it to you ? You’re welcome!).
It is possible to have a debt-free Christmas. But it requires a lot of self-control and learning to say “no” when you need to.
7. Always Keep Track of Your Expenses
It’s easy to get caught up in the hustle and bustle of the holidays, but you must keep track of all of your expenses, too. This can help avoid any surprises when it comes time for gifts or planning for holiday celebrations. Here are some great ways you can track your expenses easily!
- Keep a budget notebook. This is the simplest way to keep track of your expenses. Every time you spend money, write down what you spent it on and how much it was. This will help you see where your money is going and how much you’re spending each month.
- Use a budget app. There are a lot of great budget apps out there that can help you keep track of your expenses. Some apps will actually help you spend less on certain things, which is a pro tip if you want to save more this Christmas!
- Use a spreadsheet. Spreadsheets are great for those of you who like to stay organized and include details. With a spreadsheet, you can add extra information and even edit it as you go along.
8. Avoid Buy Now, Pay Later Schemes
Although it’s incredibly tempting to sign up for a buy now, pay later scheme when you’re Christmas shopping, unfortunately, these schemes can quickly leave you with a lot of debt come the new year. The holidays are a stressful time of year. Avoid more stress with buy now pay later schemes to keep your finances in the proper order and avoid any last-minute surprises that may come up!
Before you start stacking up purchases at BNPL, it’s crucial to ensure that your financial situation can handle the task. Though BNPL platforms tout that they don’t charge interest or late fees, this can change if you keep missing your payments. Although buy now pay later schemes only perform a soft credit check that doesn’t impact your scores, unpaid accounts can be reported to credit bureaus. This could result in an adverse effect on future borrowing endeavors and possibly hurt your score as well!
9. Christmas Potluck
Celebration here, party there, family dinner today, Sunday lunch with friends tomorrow! The holiday gatherings never stop! With all the gatherings planned out for the holidays, food expenses can pile up in a blink of an eye making it extremely difficult to stay debt-free! If you’re looking for a fun and frugal way to celebrate Christmas without having to splurge on all of the
10. Carry Out Price Analysis
The festive season signals the time for gift-giving and spending, but it can also be an opportunity to cut back. This year going through your finances more carefully than ever before can help you find ways to spend less this Christmas.
First of all, take inventory of everything that you already have in your house that you’ll be needing for Christmas. A great way of finding out what’s on offer this Christmas is by carrying out a price analysis. Carefully compare all of your chosen stores and see how they stack up against each other; it may be just enough time before you shop again that something better has come along – so go ahead and get yourself prepared as early as possible.
For example, if food is your top priority, check out online grocery apps and grocery store flyers to see where you can get the best bang for your buck. When it comes to gift shopping, shopping during sales, using gift cards, and taking advantage of cashback apps, like Dosh, are smart ways to ensure you’re not spending too much on gifts.
Half of the fun of this is seeing what kind of stuff gets brought from home and wrapped! Plus, it’s a great way to re-gift that fruitcake from the last Christmas party (just make sure that it wasn’t this side of the family who gave it to you ? You’re welcome!).
It is possible to have a debt-free Christmas. But it requires a lot of self-control and learning to say “no” when you need to. Christmas is the time of the year to focus on family, friends, and good cheer – not bills and financial stress. So what are you waiting for? Not only are these great debt-free ideas to help you this year, but you can apply these Christmas tips for every coming year!
Merry Christmas, ladies! Wishing you all the best during this joyous time! May your days be filled with happiness, peace, and love. And may your bank account stay healthy too! ?
Make more money before Christmas:
- 30+ Real Ways to Earn Money From Home
- How I Earn Money as a Stay-at-Home Mom
- Make a Full Time Income From Home Proofreading
- 7 Survey Sites that Are Actually Worth It
- Secret Shopping from Home
- Make $40,000 per Year From Home as a Bookkeeper
Ways to save money when you shop:
- 5 Ways to Save Money Going Out With Friends
- Never Pay Full Price at Restaurants
- Best Money Saving Apps You Need
- Save Money When You Can’t Afford It
- Money Saving Tips That Helped Us Save $21,972 Every Year!
- 7 Ways to Still Date Your Spouse When Money is Tight
- How to Start a Budget the Easy Painless Way
- Money Saving Websites That Thrifty People Love
- Save Money When You Live Paycheck-to-Paycheck
What are your favorite Christmas traditions?
