Christmas is coming! Is your budget ready?

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The Sun is shining, my front lawn has dried to a crisp, and we’ve just had the Summer Solstice so I am asking you this question: “are you financially prepared for Christmas?”  Yes I’m being serious!


The big day is less than six months away and with only five pay days (or less) to go it is important to start making plans.  Christmas is a big financial event and for many people it is a time when they find themselves going into debt or even further into to debt.  For the sake of one day!  That happens every year!


Luckily there are some steps you can take now to soften the blow and stop December from becoming overly stressful and overly expensive.


  1. Work out the total cost of Christmas

Your first step is work out exactly what Christmas is going to cost.  This means the whole of Christmas!  Not just the presents but everything.  The whole event is actually a constant leeching of money but that’s no excuse.  We just need to be ready.  Here is my list of all potential expenditures over the Christmas period:

  • Presents-obviously! But make sure you include things like presents for school teachers, tips for the paper boy (if people still do that), gifts for kids’ friends.
  • If you are the sort of person that likes sending cards then factor this in.  Yeah they might only be a few quid but you need to budget for it.
  • Gift wrapping. I always forget about this one.  But it is expensive.  By the time you’ve considered boxes, bags, name tags, ribbons and bows you’ll have spent a fair bit of money.
  • Food and drink. If you are hosting Christmas this year then the likelihood is that you’ll be spending a good amount of money on food.  Whether it is those tins of sweets or to secure the turkey from the local supplier, none of it is cheap.
  • Advent calendars. I made the decision when my eldest was born not to do chocolate advent calendars and instead bought her 24 tiny gifts to unwrap.  It’s lovely but every year I forget and end up panic buying stuff late November.  Not this year though!
  • Christmas party. Does your work have a Christmas party?  What about your partner’s work?  All of these things are part of the parcel of Christmas.
  • Whether you are spending the Christmas break somewhere hot and sunny or if you are visiting relatives, there could well be unusual travel costs involved over the festive period.
  • I love seeing my girls in Christmas clothes.  I’m a sucker for a snowman tutu or a Father Christmas hat.  I also like to treat myself to a new outfit for the work Christmas party.


To help you work out how much you spend on each of these it might be worth taking a look at your accounts from last year.  How much did you really spend on the kids’ presents (not what you thought you were going to spend)?  What about your food shopping?


Write those numbers down.  Be honest at this point.  If they are big numbers and they scare you, that’s OK.  Time for the next step.


  1. Reduce those costs

It is not wise to under budget.  If you expect Christmas is going to cost the same as last year then you need to be ready and have that money waiting.  However, if you are feeling like you cannot afford that level of expenditure then there are a few things you can do.


  1. Aim to spend less. This one seems a bit obvious but let me explain.  If you spent £60 on your mum last year then why not aim to spend £50-55 this year.  It is unlikely that she will notice the drop in value (plus she’s your mum so she will love you anyway) and if you can do this for everyone then you could reduce your Christmas bill by 10% straightaway.
  2. Be on the hunt for bargains now! The best time to get good deals is not at Christmas.  The further away from Christmas you are the more likely you are to find a good deal.  For example I reckon Christmas cards are pretty cheap right now.  Also if you know what you want to get someone you can do some thorough research and you’ve got time to wait until it drops to a price you are willing to pay.
  3. Get your craft on. Making stuff rather than buying is cheaper, but it is time-consuming.  Luckily, because we are starting early, we’ve got time.  You can look for scraps of fabric in charity shops or sales.  Or you can stock up on card and paper.  And you can practise those cute poses you want you kids to pull for your family Christmas card.  I’ll write another post soon about with frugal Christmas crafts.  Don’t worry!
  4. Stock up on bargain vouchers and coupons.  Throughout the year there are offers on gift cards.  You could stock up now and save them buying gifts.  For example, you could start buying Tesco gift cards now with the view to use them on your food shop in December.  Another option is to save up your rewards points and use these for your Christmas shopping.  I love a Tesco clubcard voucher!


  1. Work out the difference and budget

Once you’ve thought about all the ways you are going to reduce your costs you need to budget for the rest.  At the time of writing this there are five (end of the month) paydays left before Christmas.  Don’t worry this is easy maths!  Take that big number and divide it by five.  Or however many paydays you have left until Christmas.  That’s how much you need to put aside EACH month.


OR you can do what I like doing and start my Christmas shopping early.  I buy a few bits each month and deduct this from what I should be saving.  Anything that I don’t spend I put aside ready to spend in the future.  This is probably the most practical way to approach your Christmas shopping as it will allow you the opportunity to get the best deals.  Waiting until late November/early December leads to overspending and stress.


Now if the amount you’ve got to save each month scares you a bit then firstly revisit the ways to reduce the cost section above.  If you’ve cut it down to the last penny then you need to look at other areas of your life.  Luckily I’ve got a few posts already written about this.  Check these out:

Things You Buy Every Week That I Don’t

10 Things You Can Do To Save Money This Month And Every Month

Extremely Frugal? Would You Go THIS Far?


To summarise:

  • Work out the total cost of Christmas
  • Reduce those costs
  • Work out the difference and budget


And as a final point don’t forget to use a cashback site like Quidco for all those online Christmas purchases.  Sign up here and get an extra £10.  Put some of your cash back in your pocket and maybe you’ll have enough for a little treat in January.


Disclaimer:  Remember the information you read here does not represent financial advice.  Any ideas or suggestions are just that and may not work for you.  Read the full disclaimer here.

Whether you are trying to live frugally or aiming to get debt free, Christmas can prove quite a challenge! That's why I recommend thinking about it now and making a savings plan. Putting Christmas into your budget earlier will take the stress out later. Take a look at how to get your budget ready! #Christmas #budget #debtfree #savings #lookingafteryourpennies

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