Creating a Budget for the Christmas Holidays

The holiday season can be incredibly sneaky with its overlooked costs and last minute presents.  The best way to take control of your Christmas spending is to create a budget and keep track of your expenses as you go.  Purchases may still sneak up on you but at least you’ll be ready with a realistic budget to help you squeeze in any little extras when needed.

Make Lists for Everything

Make a series of lists, or even a spreadsheet, of everything you will need to spend money on this holiday season.  Gifts alone will be a major category and once you have an idea of what you can spend, a limit should be assigned to each gift.  You should also prioritize this list in case your budget is too tight and some gifts need to be less expensive or eliminated entirely.

Parties and entertaining will be another major list.  Estimate how much you’ll be spending on food, drinks, and party supplies.  If this list gets too out of control you may need to cut back on some of your Christmas parties, have someone else host them, or start hosting potluck parties to save on food costs.

Keep a miscellaneous list as well and leave yourself a little room to add things you may have forgotten.  Many people use the same decorations every year but you may need a new tree or want to add to your winter scene collectibles.  Adding these extras to your budget will ensure nothing sneaks up on you and will remind you to avoid purchases you don’t really need if money starts getting too tight.

Keep Track and Stay Updated

Making a budget and burying it away in the back of a drawer will do you absolutely no good whatsoever.  Keep it on hand so you can check back on a regular basis.  Post a copy on your fridge so the whole family can be aware of expenses.  Take your budget with you when you go shopping so you can cross things off your list as you go.  If you keep your budget up to date you’ll be able to track your spending to ensure you aren’t going over your limits.

Using a cash-only system is a great way to be more aware of your spending.  Keeping your Christmas budget funds in an envelope or separate wallet will remind you how much you’re spending when your stack of cash starts feeling thinner.  A separate Christmas account can be a good idea as well so you can easily keep track of holiday spending versus your other regular bills and expenses.

A Christmas budget not only helps you determine how much you can spend over the holidays, it also reminds you to be aware of your spending.  It’s all too easy to get carried away with the excitement of Christmas and the spirit of giving but a strict budget can steer you away from unnecessary purchases.  Keep track of even the smallest items you buy as those are often the ones that add up and come back to haunt you on your January credit card statements.

Title Post: Creating a Budget for the Christmas Holidays
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