The Challenge
How To Create A Holiday Budget
The first step in deciding on a holiday budget is figuring out what is most important to you. Is it? - Get-togethers
- Gift-giving
- Reconnecting
- Holiday adventures
By first prioritizing your ideal holiday experience, you can better allocate funds to focus on what matters most.
Next, make a list of every potential holiday expense and how much you feel is reasonable to allocate to each category. Below are some holiday expenses to think about (though you may have others):
- Holiday photos and cards
- Holiday parties
- Gift-giving
- Decorating
- Travel
- Religious events or other traditions you take part in
- Charitable giving
With your list in mind, you can better decide how much to budget for the holidays. Then you just have to start saving.
Finding Money For Your Holiday Budget
Budgeting for the holidays is one piece, but how do you come up with that extra money? Some people start saving at the first of the year; some wait until summer or even fall. Whichever method you choose, here are some ideas to get you started:
- Make Smart Spending Swaps — As the holidays approach, you can divert any discretional spending expenses to your holiday savings. Here’s an example, instead of going out for dinner, eat at home and save that extra cash
- Save Your Pennies — An easy way to start building your holiday fund without much effort is to put any small, extra income directly to your budget. For example, you can collect any loose change throughout the year and cash it in specifically for holiday spending. The more small deposits you make, the more your fund will grow
- Earn Money Specifically For The Holidays — As the holidays approach, a good way to make room for new gifts, as well as earn money for the holidays is by cleaning out your house and selling items at a garage sale or online marketplaces. You can also pick up a side gig with a hobby you are already involved in
Make A Commitment To Simplify
Beyond budgeting, another way to save your finances this holiday season is to simplify your expenses.
- Rather than buying gifts, make them
- Send holiday cards instead of small gifts to co-workers, family members, and acquaintances
- Give your time, rather than tangible items.
- Make holiday get-togethers potluck rather than hosting everything yourself.
- Start a tradition of limited gift-giving or of spending money on holiday trips or experiences rather than things.
The options are endless, and with some creativity, your holidays will be less stressful, more meaningful, and leave you with more money in your account.