How to Cut Your Christmas Costs This Year

Well, Christmas is coming. We’ve got about two and a half months until Christmas Day. Are you ready for Christmas just yet?

Christmas is always an expensive time of year. There’s presents to buy, food to consume, alcohol to drink, and friends and family that want to spend time with you. So there’s also travel expenses to consider. How to Cut Your Christmas Costs This YearAll together it can cost a lot of money to be social during the holiday season.

Holidays should be about relaxing, sitting back, and taking a load off. So if you’re nervously waiting to pay your dinner bill, then how will you enjoy the company of your friends?

Instead of anticipating a stressful and frustrating winter, plan ahead, take care of the shopping now, and help yourself enjoy this upcoming Christmas.

Set a Budget

Be realistic about how much you can afford to spend over Christmas. It’s tempting to want to spend money on people that are special to you as there’s an emotional component to giving gifts.

You want to reward the people most important in your life with a physical representation of how much they mean to you. This can be a good thing. For some people, gift giving is the best way to show someone that they care. What we’ve done over the last couple of years is we set a budget for Christmas gifts.

We make a list of everyone that we’re going to buy presents for, and we set a budget for gifts. This way, we’re not stressed or worried about how much we should be spending on one particular person, and we can start planning in advance for how much Christmas will cost overall.

As for the budget itself, that totally depends on your own personal financial situation. Our yearly budget changes, depending on what type of gift exchange we’re doing with our family. We make sure to talk about it as an entire extended family so that everyone has the same expectations.

A few things you can do to make sure your budget is reasonable is make sure you’re only giving gifts to those that are returning gifts. Chances are good that if you haven’t received a gift from a friend for a couple of years, exchanging gifts is not a priority for them, and most likely won’t mind if you don’t get them one this year. When in doubt, it’s always good to just ask and confirm.

Make sure that you’re limiting the cost per person. Buying a gift that is quite a bit of money can actually make the other person feel awkward and indebted to you. For kids and babies, something in the $20-35 range should be adequate, and for adults, $40-80 should also suffice.

Buy in Advance

Another great strategy is to get the shopping part done early. I suggest finishing your Christmas shopping by halfway through November. There’s a couple of reasons for this.

First and foremost, it’ll reduce stress for you. Hitting December 1st and having no more gifts to buy is a massive assistance to your personal health and well being. December can be busy enough as is without forcing your free time to be spend wading through hordes of shoppers at your local mall.

Secondly, it’ll save you tons of time. Everything takes longer during the holiday shopping season. The drive takes longer because there’s more cars on the road and the weather conditions are worse. The parking lot will be full and it’ll take more time finding an available spot. There will be more people to walk around while you’re searching for that gift that you’re not sure about yet, and once you’ve picked it, the lineup at the cash register will be longer than normal.

As a great bonus, by purchasing the gifts in October, you’ll be splitting up Christmas costs over a few different paychecks, so if there are any unexpected expenses for a gift or for travel, it’ll be more easily absorbed over a longer period of time.

What are your strategies for dealing with Christmas costs this year?

Written by Alan Schram

Alan Schram writes about personal finance and his encounters with it in his everyday life. Alan is recently married and is looking to save money on expenses and reduce his debts.

3 Responses to How to Cut Your Christmas Costs This Year

  1. If I was a guy I personally wouldn’t chose to finance the ring. After marriage comes houses and babies for a lot of people, and having a big fat monthly installment for the next five years way be a big hinder! Buying a small ring and replacing it with something better in the feature is a lovely idea!

  2. I like this post a lot, but I have to disagree with you on the subject of only giving gifts when you know you’re getting one in return. My brother and his wife have been buying gifts just for the kids in the family for years, yet every year me and my wife still have something for them under that tree. Why? For all the reasons you mentioned. It’s a great feeling to give a gift, and we want to let them know how much they mean to us. I think better advice would be to scrutinize your list and carefully think about why you’re giving a gift in the first place. Is it because you really want to, or because you think you have to? Only those that are heartfelt and that you’ll love shopping for and seeing their faces when they open it should receive a gift. And people, such as my brother and wife, shouldn’t be reminded to feel badly about themselves and their personal finances just because they couldn’t afford to buy a gift for someone.

  3. Strangely enough I have always bought Christmas gifts in October and November. I thought it was only me! It’s less stressful and a whole lot cheaper. Don’t believe the marketing hype about so-called “Christmas offers”; I worked in retail for 20 years and prices go UP before Christmas. The offers come in January.

    What I have also found is that it’s a lot easier to find Christmas gifts when you’re out doing normal shopping in October, than when you’re “on a mission” to do Christmas shopping in December. As you say, get rid of the stress and enjoy the Christmas season knowing that you have already bought all your gifts – and kept to your budget.

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