There’s no getting around it – Christmas is right around the corner. And, my children are small enough to still believe in the magic of Christmas, as well as Santa Claus. While I love their enthusiasm about the holidays, my pocketbook cries this time of year. Which made me think, what are some ways to successfully budget for the holidays, as well as some budget friendly gifts to give?
Christmas club accounts. The idea here is to deposit a set amount of money into a separate account. A lot of banks have backed away from Christmas club accounts, but many credit unions still offer them. The perk to a Christmas club account is the return on these accounts in negligible, and you usually cannot take the money out until the start of the holiday season, around November 1.
Of course, with enough willpower you can do the same thing by depositing the funds directly into a separate savings/checking account, without having to set up a specific Christmas club account. But, my fear is that I would be tempted to raid the account for an emergency, with the intention of “paying it back” (hence why my husband is in charge of the finances).
Bankrate.com has some great money-saving tips for the holidays. They include:
1. Make your budget and gift list now. I follow this practice and do this before I leave the house to go Christmas shopping. And, just because I have X amount to spend doesn’t mean I have to spend all of it. If I can get what’s on my list at without spending all the funds allocated for Christmas, it doesn’t mean I buy extra gifts for everyone and spend all my budget.
2. Set aside some money. The Christmas Club account idea. Much better to put aside money to pay for the holidays in cash than to put it on a credit card and pay for the holidays for the next six months (or more, depending on how fast you can pay the card off).
3. Start shopping now. My mother loves Christmas, and she starts shopping for it during the summer. She will see things that she knows someone on her list would love, and she’ll pick it up and put it away until the holidays. This allows her to spend little bits of money here and there, instead of plunking down a huge amount in one month.
4. Order early. If using the internet/catalogs to do your holiday shopping, buy early. You can get items in the off season at a fraction of the cost.
5. Pick your plastic. If you plan on using a credit card to charge some of your holiday purchases, choose the card you want to use. Negotiate a low interest rate on it if you think you’ll be carrying a balance.
Another way I try to keep costs down during the holidays is by making some of the gifts my children give. By no means am I super crafty, but with the help of Pintrest, I am able to find things my girls and I can make that family members will love. This year we made bowls out of plastic beads by melting them. In previous years we’ve tye-died aprons, made ornaments, and painted a tray that had a footprint turned into a snowman.
I’m always interested in hearing good ways to save money (or great budget friendly gifts), so if you have a tip you’d like to share, I’d welcome hearing it!
Amy S. Hodgson, ACP