Don’t let holiday spending get the best of your budget.
With Christmas just weeks away, it’s high time to start planning your holiday budget (if you haven’t already).
Whether you like to make one masterful holiday budget that includes Christmas and New Year’s or if you’re just looking to cover your needs for Christmas or Hannukah, there is a lot to take into account before you start spending with wild abandon.
While there is no one size fits all approach to planning for the holidays, there are a few things that everyone should keep in mind before hitting the malls and holiday parties for the season.
Set Your Budget
Before you even think about spending, you need to have a plan in place for how much money you plan to spend in every holiday category, from travel to gifts to parties and beyond. Try to think about what your holiday season usually looks like. What kind of activities do you do? Where do you travel? Where did your budget last year succeed? Where did it fail?
Asking these questions can help you craft a budget that aligns with your priorities, so you don’t end up mindlessly overspending. It’s easy to get swayed by sales or carried away with decorating, but having a strong plan in place can tamp down temptations while still ensuring you have all the holiday fun you love.
If you can, leave a little wiggle room so you can adjust as necessary. I like to make sure my holiday budget is always a little bigger than I think I’ll need, so I don’t end up dipping into my regular monthly budget due to poor planning.
Save Before You Spend
Once you have your budget set, you need to make sure you have the cash on hand to match that amount. Don’t start spending before the money is in your account. Hopefully, you’ve been saving for the holidays well in advance, but if you haven’t, don’t panic. There are plenty of ways to drum up some extra cash for the holiday season.
For those with a set bi-weekly pay schedule, most will get an extra paycheck come November (or had one in September), which is an excellent opportunity to set aside some spare cash for Christmas. For those who don’t have the luxury of a set payment schedule, try trimming down in other areas of your budget for a couple months, or perhaps consider picking up a part-time job for the holidays. Lots of stores will offer flexible part-time work to help cover the holiday rush, which can give your holiday savings a serious jumpstart.
Think Beyond Gifts
While holiday gifting may be a large part of your budget, it is certainly not the only place you’ll be spending money. For a long time, I made the mistake of planning my Christmas budget by making a list of family and friends and how much I was going to spend on each person. I’d also set a little extra aside for a Christmas tree and stockings, but that was it. No surprise – I rarely made it to the end of December with my monthly budget on track.
I needed ingredients for holiday baking. I needed gift wrap and tags for presents. I needed hostess gifts for holiday parties, and tickets for my kids to ride the Santa train (not to mention all the treats that they would want while waiting for the train). I needed extra gas money for visiting my family. I needed the seasonal Trader Joe’s biscotti and peppermint patties. I needed to have a plan for donations. By ignoring what makes the holidays a season (and not merely a day), my budget was doomed from the start.
And remember: make sure you plan for all the things that make the holidays special because it’s about so much more than the ‘stuff.’