How To Save For Christmas? 6 Easy Steps To Debt Free Festivities

We both know Christmas is on the same day every year don’t we? So why do we we worry about how to save for Christmas, every year?

It’s so easy to think in December, next year will be different.

Next year I’ll start saving for Christmas in January.

Next year I’ll be Mrs. Organized and have Christmas wrapped up by October.

Christmas is an area I struggled with for years.

I could be frugal and save money/live within my means for 11 months of the year.

Yet come Christmas and my frugal ways seem to disappear and leave me with no seeming choice but to spend, spend, spend.

And every January I would struggle to get back on the frugal wagon, vowing to master the lesson of how to save for Christmas AND be more organized.

Of course I had to pay the bills I incurred for that Christmas first.

Its not that I wanted to splash the cash, nor that I loved buying expensive presents for family and friends.

Christmas just seemed to cost too much money and bring out my spendy side, and I didn’t even enjoy it.

I finally realized a big part of my problem was the sheer number of relatives I was buying for.

How I ended up buying for so many I really don’t know.

I counted them the year I started trying harder to create a Christmas budget and stick to it and was pretty shocked by the total.

dollar note rolls tied with red ribbon

46 Relatives

I had been buying presents for 46 relatives every year!

Without ever realizing.

And that didn’t include Mr2p or our daughters.

No wonder I got all spendy, the sheer number of people to buy for was making me feel pressured into starting the present buying process before I had formed any type of plan or budget.

The realization of how many people I was buying for was like light-bulb being switched on.

It wasn’t that I wasn’t frugal at Christmas, it was just that I was getting overwhelmed with trying to fit in organizing Christmas while working full time and bring up 2 daughters.

On my one day each week when I had time to go present shopping I was on a mission to buy presents, any presents, as long as I could tick people off my list.

You can see why I went into major spendy mode.

Some thing had to give and it was my hope of sticking to any form of Christmas budget.

Related post: How to have an amazing Christmas on a budget

Come and follow me on Pinterest for more money saving hints and frugal tips!

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Christmas On A Budget

Christmas can be a very expensive time and stressful time.

Its technically just one day out of 365 but in reality it’s more like a 10 day period.

It’s a time that you really want to look forward to and enjoy without worrying about money, about how much it’s all going to cost and how much debt you’ll end up with.

Worrying about the cost is just the start isn’t it?

You’ve also got to factor in thinking about a million different things. Things like:

  • Entertaining the kids during the holidays
  • Buying co-worker gifts
  • School end of term activities
  • Local community events
  • Work Christmas parties
  • Family gatherings
  • Social gatherings of friends
  • Buying everyone the right presents
  • Entertaining all your guests
  • Buying all the festive food to share with family

And these all cost money. Money you haven’t yet saved up, which is a problem isn’t it?

The clock is ticking and your stress levels are rising just thinking about trying to plan and pay for Christmas.

Related posts: 

How To Have a Debt Free Christmas

Save Money When You Always Buy These 9 Things After Christmas

What To Do When You Just Can’t Afford Christmas

Check out here how the Festive Money Binder can help you be totally organized and debt free this Christmas

mock up images of smart savers festive money binder

How To Save For Christmas – My 6 Step Solution

With my 6 step solution, you can save money between now and Christmas and have enough to pay for everything.

These 6 steps will help you work out how much money you need so you can buy the right gifts for your family and friends and celebrate the way you want to.

All on budget, and without going into debt.

Step 1 – Your Present List

Your first step is to make a list of everyone you want to buy for this year.

Include co-workers, friends, teachers as well as close family.

Token presents for people like teachers and neighbors mount up quickly so if you usually buy these, don’t miss them out.

Step 2 – Spending Levels

Decide how much you want to spend on everyone you have written down in the first step.

It’s really important to do this step BEFORE you start present buying.

Knowing your budget will help you steer clear of fun but overly expensive gifts.

Given we are talking about saving for Christmas and creating a budget, be realistic about how much you think you should spend on everyone.

A thoughtful gift does not have to cost a lot of money.

Throwing money at expensive gifts does not make for a better Christmas.

It makes for debt and a very poor January.

Related post: How To Have a Debt Free Christmas

Grab these free Christmas savings plans to watch your money mount up in the coming weeks, there’s a 52 week savings plan for next Christmas too!

Step 3 – Christmas Expenses

Now you have your Christmas present list, you need to list out all the other expenses you have over the festive period.

This will very much vary from year to year.

One year you might be hosting everyone on Christmas Day, another year you might have a succession of visits planned to far flung relatives.

So looking at your plans for this year, list out everything you are going to end up spending out for.

Remember to factor in things like:

  • Transport costs (gas, flights) for travelling to relations
  • Family meal with turkey and all the trimmings
  • Tree
  • Drinks
  • Host gifts for gatherings you attend
  • Cards and wrap
  • Stamps
  • Decorations
  • Charitable donations
  • School activity costs

Related post: 9 Things I Refuse To Buy This Christmas

cHRISTMAS BAUBLES - how to save for Christmas

Step 4 – Total Christmas Costs

Now total up all your costs.

If you are anything like me, you will do a double take and go slightly white at the total figures.

This step is less about the total and more about what actions you take as a result of that figure.

If you are not happy with the total figure you have arrived at then now is the time to take action on that total and change it.

Change it to a figure you are comfortable with.

A figure that means you won’t be in debt in January because of Xmas.

Step 5 – Christmas On A Budget

There are 2 ways of completing Step 5 and achieving your Christmas on a budget because we all do our finances a bit differently.

Step 5 is about you knowing your money and what you know will work better for you and your finances this year.

Check out here how the Festive Money Binder can help you organize your budget, gift giving and be debt free this Christmas.

mock up images of smart savers festive money binder

Step 5 – Budget Solution One

This is where you need to revisit Steps 1 to 3 and reconsider what you actually want to spend.

For example, if your total budget has totaled an eye watering $2,000 but you actually want to only spend $1,000 then it could be quite easy.

Halve the cost of everything you have written down.

So presents for everyone are halved, as is the money you allocate to buying cards, wrap and a tree etc.

Alternatively you can consider each cost and decide whether it stays on your list or gets abandoned entirely.

Perhaps this year is the year to suggest to your family the idea of having a secret Santa?

Where everyone buys for one person only. You could even suggest a $/£ cap to keep the costs down further.

If you have a spendy family who won’t appreciate token gifts from you and that’s all you can afford, then by all means suggest a no present year.

They might be secretly pleased.

You’ll be surprised at how many spendy people are actually in debt, you could be doing them a big favor.


Step 5 – Budget Solution 2

This alternative solution is where you know you have a finite amount of money and need to make your Christmas savings budget fit this figure.

If you have a specific total figure you know is your limit then you can still use my 6 step system.

Complete steps 1-4 to the point of totaling up your costs.

Where the total is different to your predetermined figure then you need to work backwards.

Starting with your new total (the one you know is your limit), allocate a proportion to presents.

With your total present figure divide it into the number of people you have to buy presents for.

You may want to spend more on one person than another which is perfectly doable.

The main thing is that your total present budget is set, how you divide it between relatives is entirely up to you.

Divide up the rest of your total budget across the areas you have already identified as things you intend to spend out on.

Sometimes you have to make hard decisions at this point.

You don’t have an unlimited pot of money to spend right now so within the budget you have set, choose what you will spend it on.

There are many different ways to master how to do Christmas cheaply.

Have a look at these posts for more Christmas money inspiration:

How To Buy Xmas Gifts – When You’re On a Tight Budget

The Perfectly Simple 12 Week Christmas Savings Plan

Step 6 – Christmas Savings Account

The final step in my plan to help you master how to save for Christmas is working out how you are going to achieve your total budget figure.

Get out your calendar and count how many weeks there are between today and 2 weeks before Christmas.

Divide your total budget by the number of weeks and this is how much you have to save each week in order to achieve your goal of having this sum of money to spend AND not going into debt.

Each week save this money into a separate Christmas savings account you have opened solely for your Christmas savings.

That ways you know exactly how much you have saved and can see the total growing.

Alternatively you could draw out the exact amount each week in cash and put it into your favorite (empty) piggy bank.

Only do this if your budget is modest and your house insurance would cover this cash in the event of a burglary or house fire.

craft supplies depicting christmas on hessian background

How To Do Christmas More Cheaply

When I realized I was buying presents for 46 family members I decided this had to change.

I had to learn how to do Christmas cheap otherwise I would always be in debt.

At just £10 per person, it still meant £460 as a minimum and likely much more if my budget went haywire.

I changed how I bought presents. Instead of buying presents for each individual I switched to a family present or a couple present.

This simple change more than halved the number of presents I had to buy in one go.

Buying family and couple presents also simplified my present buying.

They are a lot easier to find suitable, thoughtful gifts in all price ranges, more so than trying to find the right present to suit the personality of one person.

And in recent years I have focused more on DIY Christmas gifts to help keep the costs down.

Not only do I get to give more personalized presents to family and friends, I can be making them well ahead of time so reduces my stress levels in December.

These posts might inspire you to do the same:

10 Best Homemade Gifts For Christmas – No Cooking Required!

11 Simple And Beautiful Homemade Food Gifts For Christmas

26 Easy Recycled Gift Ideas Your Family Will Love

Find out how the Festive Money Binder can transform your Christmas budget and help you be debt free in January:

mock up images of smart savers festive money binder

how to Save For Christmas – You’ve Got This

I have used these 6 steps successfully every year since and now I am able to stick to my Xmas budget and be frugal 12 months of the year.

Learning how to save for Christmas took me a long time but when I finally did, it made a huge difference to me.

I don’t have credit card debt every January and now I feel in control of my spending 12 months of the year, not just 11.

And most importantly I am able to enjoy the whole festive period without worrying about money.

I can now focus on spending quality time with friends and family.

For more money saving help and tips have a read of these posts:

Live Cheaply – How You Can Win At Living On Next To Nothing

99 Super Productive Things To Do (Without Spending Money)

Grab these free Christmas savings plans to watch your money mount up in the coming weeks, there’s a 52 week savings plan for next Christmas too!

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Last Updated on 9th March 2022 by Emma

About Emma

I'm here to help you become confident in making the best money decisions for you and your family. Frugal living has changed my life, let me help you change yours.

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