How to set a budget for the holidays
The holiday season is a joyous time of the year filled with giving. However, it can easily become the season of spending too. To help take the stress out of the holiday season, we have pulled together our top tips to help you set a budget for the holidays - and how to stick to it.
Set a spending limit
Our first tip is to set a holiday budget and to commit to how much you will spend. This will help you figure out how much you can afford to spend in total. Ideally, this amount should come from your available savings and cash, and not your credit card.
Assign your spending into categories
We have found that allocating a set budget into a set of categories is a great way to budget for the holidays. Use an Excel spreadsheet to list how much you want to spend in the following categories: gifts, wrapping paper, ribbons and cards, postage and shipping, food, decorations, holiday expenses, clothing, travel expenses and charitable gifting. Knowing how much you have to spend on each category will help you nail your budget.
Remember to track your spending
It’s one thing to set a budget and list your expenses into categories, but it’s another thing to stick to it. Our top tip for sticking to a holiday budget (and any budget that is!) is to track your spending. Refer back to your budget, note down how much you actually spent. If you overspent in buying gifts, re-coup that difference by reducing the budget set in another category. It’s important that you keep adjusting your budget so it accurately reflects how much you have spent, and how much you have left.
Make your gifts
One of the easiest ways to save money over the holidays is to make gifts for your friends and family. Whether it's baking biscuits and popping them into a beautiful box, upcycling a lamp you found in a thrift shop, or knitting a scarf using wool you have at home, making a gift is also a wonderful way to show someone how much you care about them.
Shop secondhand
You don’t always have to buy new gifts! Save some money and see what you can find in secondhand shops and charity stores. These days the homewares on offer are so beautifully curated that they could be brand new! A secondhand gift is unique and won’t bust your budget.
Give experiences instead of gifts
Give the gift of time to your closest family members. If you’re a busy parent with not a lot of spare time on your hands, the gift of time is priceless. Give your partner a Saturday off, meaning that they have the day to themselves to do whatever they want, without any parental responsibilities. Think of all the things they could do! A kid free day means they could go to the movies, take a long hike, book that massage, enjoy a lunch with friends, even spend an hour in the bath reading. Sounds amazing huh? Well, go on - give the gift of time!
Shop smart
Whether you're shopping in person or shopping online, it’s best to have some strategies by your side. If you are shopping in person, write a list before you go and stick to it. Only go into the shops you need and don’t get distracted by all the festive fanfare around you. Focus and onl get what you need. If you are shopping online, take advantage of sales and discounts but also remember to get savvy with online shopping, which can cost hundreds of dollars. To avoid multiple shipping costs, try to get what you need from one or two retailers. The more retailers you buy from online, the more shipping costs you’ll incur. And no one wants that.
Get prepared for next year
Yes! It might only be December but now is the perfect time to get prepared for next year. Open an interest earning account and put aside a set amount of money every month. Whether it’s $50 or $100, it adds up and you could have $600 to $1,200 ready for you to budget and spend next year over the holidays. Now doesn’t that sound great!
