Do Christmas On A Budget This Year

Wondering how to do Christmas on a budget?

I can go on and on telling you Christmas isn't about what you's what you give. Countless books and experts and articles will say you should just put everyone on notice that you can't "do Christmas" this year. Or, you put everyone on notice that you'll be doing homemade gifts...and so on.

But maybe you and your family enjoy giving and getting gifts--and not the homemade variety. Is it possible to hit the mall and do Christmas on a budget?

If you aren't the homemade-gift type and need to be realistic about Christmas, keep reading. I'll give you some ideas on how to plan ahead, give great gifts and avoid making the season of peace the season of family-room brawls.

Begin With A Budget

I always pull out my Christmas binder in November, copy off a new budget page (downloaded from and fill it out completely.

I account for: gifts, decorations, movies, music, meals, parties, Christmas cards, postage and baking. I begin with a set amount saved throughout the year (usually about $80 a month) and work backwards from there. Priorities are accounted for first (gifts). Then I keep going until the budget's spent.

I actually keep each year's budget in my Christmas binder. It's fun to see how much we spent in 2002--and notice that it's hardly gone up at all!

Pay With Cash

The most successful way to stick to a Christmas budget is to work with cash. If you want to use a credit card to shop, fine--but you'd better have cash in the bank to cover the bill when it arrives. A Christmas club or separate savings account is perfect for keeping these amounts separate. We have several savings account at our local credit union, which we can access online. It makes transferring money a breeze.

If you don't use cash, the temptation is too great to overspend and go into debt. Studies show paying with a credit card tempts you to spend around 30% more than you normally would.

If you use paycheck budgeting, it's easy to set aside Christmas money every paycheck. (In our case, it's our total Christmas budget divided by 26 pay periods.) You can transfer the money to a savings account every pay period, or take advantage of direct deposit to distribute your paycheck into different savings accounts at the same financial institution.

You can also try your bank or credit union's Christmas club, for convenience. Our credit union offers automatic deposits or direct deposit, no maintenance fees, no limits on deposits or withdrawals, automatic renewal each year, and convenient transfer of the Holiday Club balance into our regular checking account on November 1.

No matter how you set it up, begin by deciding to do Christmas on a budget, set the budget amount (don't forget food, decorations and other Christmas expenses), automate the savings process, and your research!

A Few Rules

Rule #1: Buy 'em what they want. What's the point of getting something on sale if the person I'm gifting isn't thrilled? Our family sends out lists as early in November as possible. It's a win-win for everyone. The occasional surprise sneaks in, and that's fun, too, but there's nothing like giving someone a gift you just know they'll appreciate.

Same goes for homemade gifts. If they won't use it, or don't want it, what's the point? My dad is a diabetic, so I'm not making him jelly.

Now, I'm not being materialistic here. Think about it. If it's the thought that counts, then the gifts aren't really all about you, are they? It's about buying or making something thoughtful that your loved one will enjoy, as long as the price is within your budget.

Rule #2: Always, ALWAYS, get gift receipts. Tuck the receipts into the gift-wrapped package. Make sure your recipient knows you don't feel the least bit offended if they need to return the gift for a different style, color or size. You want the money you spent to be worth every penny.

Rule #3: Lists, lists, lists! I have a Christmas binder that I've kept since 2003. I printed out master pages from and then make copies every year. I track our holiday budget, gift suggestions, gift closet inventory, internet shopping tracker, my master gift list with running expense totals, menus, baking and more. These lists are invaluable as I begin my Christmas shopping.

When you leave the house, have your master "Christmas on a budget" list with you. If you see a sale, you're good to go! Buy away and then cross the item off your list. You won't spend extra money. You'll always be on a mission when you enter a store.

Rule #4: Set limits with your immediate family. Err on the side of conservatism versus extravagance.

When our kids were little, even though we were flush with cash at the time, we asked Santa to bring just one or two gifts each year. We didn't go crazy buying them gifts, either. With all our friends and family, our kids always had great Christmases, but their expectations have remained reasonable and focused more on traditions and get-togethers than gifts. That came in handy this year when we told them they weren't having a Christmas from us, then surprised them with a greatly discounted Disney cruise two weeks after Christmas!

One of the best traditions we started was to take our kids to the dollar store when they were little. They were given $2 to buy one gift for each of their siblings. They had tons of fun picking out just the right present. When Christmas morning came, the kids were most excited about opening the gifts from each other than they were the "big" gifts from Santa and Mom and Dad. I can't tell you how great it was to watch the kids get tangible joy out of giving gifts to each other, versus being focused on just "getting stuff".

Rule #5: Set limits with extended family. Even if you experience some pushback, make it clear that you need to do Christmas on a budget, and that you want to be as generous as possible, within limits. Be honest with your recipients, or parents of recipients, about the type of limits you're setting, and then ask for gift ideas. You don't have to explain why; you simply say that you need to cut back this year. Of course, you should also make it clear that you don't expect them to spend more than your limit when it comes to your family's gifts.

You may find your other family members are relieved--chances are they've been overspending all these years. This is where lists come in handy.

One great suggestion: as families grow, and there are several siblings or children to buy for, start a "lottery" system. Each recipient draws the name of someone else in the group, so everyone is responsible for buying one gift. (If kids are involved, obviously parents are the ones doing the drawing and buying.) Because each family buys fewer gifts, higher gift can be set. For example, if I have 10 nieces and nephews and a $10 gift limit, then I normally spend $100. But if I draw names on behalf of my three kids, and we set a limit of $30 per gift, then I'm only spending $90. Each child is getting a really nice gift, instead of a whole bunch of "little" ones. Works great for grown-ups, too.

The key to doing Rule #5 tactfully is to make sure you stress that your goal is to show your affection with a thoughtful gift, and that you're simply being as honest as possible in order to accomplish that goal. I have yet to encounter anyone who is offended by such an approach, but I'm sure it can happen.

Shopping For Kids?

If you don't have a wish-list in hand, the best place to start is's current list of hot Christmas toys. I typically start checking this page in mid-October, but things really heat up around Thanksgiving.

One quick perusal of this list will get you up to speed on what all the kids want this year.

Use this year's list of hot Christmas toys to begin making your own gift list. Jot down Amazon's prices for comparison purposes. Then begin researching on the internet. Can you buy the toy cheaper somewhere else? If not, go for it on Amazon.

When it comes to getting the best deals on popular toys, earlier is better. While Black Friday is the best time to get deals, if you can't (or won't) get up early and head to stores, remember Cyber Monday (the Monday after Thanksgiving) is another terrific day for deals as well.

Click here to access Amazon's current bestselling Christmas toys.

Shopping For Adults?

At the risk of repeating myself, is also a great place to start when it comes to shopping for adults.

Wondering which tools or perfumes are selling best this year? Check Amazon and sort by "Bestselling". Same goes for books, movies, electronics, video games, clothing and more.

Another great way to use is to have your spouse, siblings or other significant adults in your life complete wish-lists. It doesn't mean you have to buy these items from Amazon, of course, but since Amazon carries such a wide range of items, you can get a Christmas list ready-made with links to item photos, reviews, prices and more.

Finally, before you buy any item (especially a big-ticket item), look it up on just to see what customers are saying. Read reviews and browse around. Find accessories and complementary items such as guides, DVD's and more.

Then, take your list and Google the item (with model number, if appropriate) or visit discount and popular store sites. Compare prices on as many different sites as you can find. Don't forget to include shipping costs.

Remember, the whole point is to begin with a list, do your research and end up with a deal. Without a reference point, you won't really know whether a deal is frugal or not.

And look at it this may end up buying most of your gifts online, without ever having to battle the crowds!

Going Homemade

Some people really enjoy receiving homemade gifts. Some really enjoy making them. I know people who can produce beautiful quilts, sweaters, art, candies, cakes, delectables and more with amazing ease. And talk about being frugal! You can save a ton of money by giving homemade items to those you love.

However, I've found that homemade isn't always cheaper, especially when you factor in the time involved. Sometimes time is money!

If you don't enjoy making gifts, do not feel guilty about it. Many "frugal Christmas guides" make it sound as though you are a crazed consumer if you give anything that came from a store. Nothing could be further from the truth. Again, it's about giving a gift your loved one will appreciate, not necessarily what works best for you. As long as you stay within your budget, homemade or store-bought should be a personal decision that brings joy to your giftee and you as well.

Decorating For Christmas On a Budget

You can totally blow a frugal Christmas when it comes to decorating. When you figure in the cost of a live tree, fresh greens, light replacements, centerpieces, wreaths and more, it can really add up.

Set a budget for how much you can afford to spend on decorating this year. Begin spending that money with items you need most or want most. In our case, we decided to stop paying $60 or more for a live tree and bought two artificial trees at Target the day after Christmas a couple years ago. Now we have a tree in our family room and another one in our kitchen. Total cost? $100!

That freed up money to buy one or two new decorations each year. I like to decorate in an early-American primitive style, and really enjoy adding to my collection each year.

You can buy very life-like artificial wreaths, garlands and trees, and use delightful candles to simulate that fresh-fir smell. (I prefer Yankee Candle's Mountain Pine scent--it's really strong!)

Try to use things you already have around the house, or nature, when it comes to decorating. I buy a couple bags of cranberries and use them instead of potpourri. Mix with walnuts in a wooden bowl and plop a big pillar candle in the middle for a delightful centerpiece.

Send the kids out scavenging for pine cones. No need to spray; just put them in a pail or basket and add a few berry sprays from your local craft store.

For a whimsical light displays, take a rope and some clothespins and hang up old mistmatched kids' gloves, mittens and hats. Thread colorful C6 lights along the rope for a really fun accent!

Terrific, inexpensive decorating tools are berry sprays and candle rings. I buy rings for $1 to $3 and pop them on candlesticks, pillar candles, bowl bottoms, and more. It creates instant holiday cheer, and you don't have to put your everyday decorations away--just pop the rings off when you're done!

You can make a very pretty centerpiece with a small wreath, some Mason jars used for canning, and tea lights. Put a tea light in each Mason jar, and then gather them in the middle of the wreath. Tie a ribbon around all the jars, or weave it around the wreath. Sprinkle cranberries, walnuts and/or pine cones on and around the wreath. Simple and cheap--I already use Mason jars as drinking glasses, and keep inexpensive tea lights on hand, so I could literally whip this up with a simple trip to the store for cranberries.

You'll be amazed at what you can come up with if you challenge yourself to use or accent what's already in your house.

The Simplest Tip For A Christmas On A Budget

Honestly, I could write pages and pages of tips, but doing Christmas on a budget can be boiled down to just one simple tip:

Keep it simple.

A frugal Christmas is still Christmas. Enjoy yourself!

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