You may be wondering why I’m writing about how to create a holiday budget when we haven’t even made it to spring yet! But thats exactly why. Now is the time to start preparing so that by the time Black Friday rolls around, you’re not freaking out about the impending holiday spending!

For whatever reason money seems to be a culturally taboo topic, but it is probably one of the utmost meaningful conversations we could, and should, be having with our partners, families, financial experts and even friends. So, today I am staring taboo in the face and sharing our experiences and how we create a holiday budget. Keep reading because this blog post is full of budgeting tips and tricks. My hope is that you too may be able to use some of these ideas to make your holiday season a bit more budget friendly!

It’s March and that means we are ten months away from the most wonderful time of the year! It is such a special time when we all want to be focusing on our families, connecting with Christ, giving back to our communities, and sharing our gratitude and thankfulness with others. It is so easy to get caught up in the love and magic that most tend to go a bit overboard in finding the perfect gift(s). Only to then start praying we win the lottery so we can pay for it all!

HOLIDAY DREAMING

We all have our own version of that picture-perfect holiday scene… maybe it is your home lined with twinkle lights, fresh pine wreaths with bright red bows and candlesticks in every window, warming your home with a fire burning under a lavishly decorated mantle, a Christmas tree that would make Better Homes & Gardens jealous, hosting your friends and family for festive holiday fun, spoiling your kids with their hearts desires…etc. All of the above sounds amazing, but how can we afford to pay for all of these things without going into major credit card debit?!

It is hard! SOOOO Hard! And it is hard for all of us. Whether you are living paycheck to paycheck or have a little extra we all experience ups and downs with money.

CHRISTMAS PAST

To put things into perspective I am going to take you back to our Christmas’s Past…. 2012 to be exact. The year we got married, paid for our honeymoon, and built a house! To say we lived paycheck to paycheck is an understatement! That Christmas I was shocked we even got a Christmas gift budget! Our gift giving budget for each other was $50. To some that might seem pointless {and in all honesty I wasn’t thrilled about it at the time} but we both ended up getting creative and made hand-crafted gifts for each other which are now more meaningful than anything we could have bought at the store!

Additionally, that year I hand made most of our Christmas tree decorations and bought a few $5 gold ball assortments from Walmart. {We still use all of these ornaments on our tree each year}. The following year, Christmas of 2013, I thought for sure we would have a larger holiday budget. November rolls around and I ask Spencer {he manages our finances} for a holiday budget and informs me of a number not much higher than 2012. It was at this point that I was upset and sad… I love gift giving and spoiling all the people in my life. And to know how hard we work but still weren’t in a great place to do so had me dissapointed.

That’s when we started to have a conversation about it, and ultimately decided to, create a holiday budget. We started to write down all of the holiday expenses we could think of as well as an anticipated budget for each expenses. Here is an example of what our list looked like. And let me tell you… we were like WOAH when it all added up to TWO GRAND!

How could all of these items add up to TWO GRAND?! 

Sure enough they did and that is when we created a plan to start saving for our holiday budget throughout the year! There are a variety of ways to go about this but I am going to share what I think is the most beneficial. 

MAKE YOUR GIFT GIVING LIST

Your list should include all the items you anticipate purchasing over the weeks leading up to the holidays. Think about hosting friends and family, home décor, events, donating to church and charities, school parties, teacher gifts, gift exchanges, potlucks, and presents for loved ones.

BONUS! If you subscribe to my Style Files I will send you a user-friendly Holiday Budget Template so you don’t have to create one on your own!

WHAT’S NEXT

After you have made your gift giving wishlist, add up how much you would spend if you bought all the gifts at the price you allocated. If you feel good about that total, great. If not, go back through the list and try to reduce your budget by a few dollars here and there.We now have a total holiday budget. But how the heck are we going to save for it?!

START SAVING

There are so many ways to go about this but my best advice is to save a portion out of every paycheck! Using our example…. let’s say you are trying to save $2,000 for holiday spending. (Remember this is hopefully for presents, donations, extra food, travel costs, and decorations.)

$2,000 / 12 months = $167

To build a $2,000 holiday budget, you would need to save $167 each month. But if you break the saving down even smaller, it becomes a little more palatable. If you were to set aside $40/week, you would have $2,080 at the end of the year. You may be thinking wow that’s not bad or you might be like WOAH! That could be the cable bill, your monthly grocery budget, possibly the monthly electric bill. Who wants to add another bill to their list??? YOU DO! If you put all that on a credit card at the end of the year, it becomes another bill at the beginning of the following year.

BETTER TO SAVE NOW THAN CHARGE LATER!

Your monthly holiday savings budget is a GOAL! Some months you may save the total and some months you may be a little short. But the key is that you are saving it! And let me tell you, it feels way better to spend money you actually have at the holidays than to let it pile up on the credit card. Once its on the card, not only do you have to figure out how to pay it off over the next several months, but you are also getting charged interest. And so what may have been a $2,000 spend in December, turns into much more by the time you’ve actually paid it off in May.

STASH THE CASH

It’s best if you are able to “stash your holiday cash” in a place that isn’t easily accessible. A savings account is the best option. If you have the option to set up an auto draft into a separate account DO IT! This is now how we do it every year. Spencer set up and auto-transfer of a small amount from our checking into our savings every week. Its not much on a weekly basis, way less than the cost of a meal out. But when it adds up over the year, we have what we need for the holiday season!

Saving isn’t easy. Spencer is team SAVE and I’m team SPEND. But together we save more than I would and we spend more than he would. We find a balance that works for us and we check in our progress every couple of months.

You can relate it to going to the gym. The first couple of pay checks will be painful when you are missing the cash. Just like the first couple of workouts. But eventually you will adjust and the pain won’t be as bad. Actually you might even start to get excited at your results when you start to see the $$$ accumulate. And then when December rolls around and you either have your full holiday budget or at least a good portion of it, you will be SO happy, proud, and most likely a little less stressed about the holiday spending!

SAVING TIPS TO CREATE A HOLIDAY BUDGET

• WRITE YOUR BUDGET LIST
• AGREE TO THE BUDGET
• CREATE YOUR SAVINGS PLAN
• SET UP AUTO WITHDRAWALS FROM EACH PAYCHECK
• USE A SAVINGS ACCOUNT
• REMEMBER IT IS A GOAL AND OKAY IF YOU CAN’T SAVE THE TOTAL EACH MONTH
• DON’T GIVE UP
• CHECK IN ON YOUR PROGRESS

While I specifically talked about saving to create a holiday budget, you can use these tips to save for anything! Family vacations, birthday parties, new car, an emergency savings fund.

I hope the tips I’ve talked about have been helpful. But I know that everyone does things differently and you may have some tips of your own that you use to keep your spending in check. I would love it if you shared your tips in the comments below and lets get a conversation going that will help us all create a holiday budget that works for anyones situation!

Photography by: Maewood Photography