Holiday Budgeting: 5 Easy Steps to Gift Intentionally and Avoid Overspending

It’s officially the holiday season and socially acceptable to listen to Christmas music, hang up the lights, and break out the ugly sweaters. They say it’s the most wonderful time of the year, but it’s also the most expensive time of the year.

If holiday stress has been bogging you down, chances are a huge part of it is financial stress. Do you have enough money for everyone on your list this year? Have you made your list and checked it twice, or does the thought of making a list make you want to crawl under a fuzzy blanket and not adult today.

If that’s you, don’t worry! This post is going to guide you through how to write a holiday budget and help you decide which purchases would be naughty or nice.

And trust me, it’s easier to start budgeting now than to spend months of next year paying down your credit cards after you’ve spent a little too much on gifting and decorating.

I’ve developed an easy 5 step process with templates to get you started. Before we get started, download this graphic or print it out so you can follow along!

Step 1: Think about Travel Expenses

Once you’ve printed out your budget template, found a blank sheet of paper and pen, or opened a new Excel spreadsheet, start thinking about your travel expenses. When people think of holiday spending and budgeting, they tend to go straight to gifts. But a huge part of your added expenses in the months of November and December come from travel. I like to also include Thanksgiving in my holiday budget, so that’s why I say November too. Write down any flight costs, gas money, and other anticipated travel expenses. Luckily for your wallet, your 2020 travel budget probably looks a lot different than previous years. At least for now Zoom calls are still free.

Step 2: Think about Excursions and Decorations Expenses

Another holiday cost we often forget to account for is local excursions. How much are you spending on your outfit for the office Christmas party or ice skating for date night? Step two is factoring in excursion and decorations expenses.

Step 3: Think about Gifting

The category you’ve been waiting for (or dreading). Here’s where we write down everyone on our list that we plan on getting presents for. For now, don’t worry about picking and choosing who deserves something from you this year, just write them all down and adjust later. If you’re using my template, you might have to group people into categories like family, friends, and office to make it fit. You can either decide how much you want to spend on each person then multiply to get a total or decide a total you want to spend on a group of people and divide it by the number of people in the group.

Step 4: Calculate the Total

Now, add the totals from the previous 3 categories and see what you get. If that number scares you, that’s okay. That’s why you’re here doing this! Budgets help us to be more intentional in how we spend our money.

Step 5: Revise and Plan

Congratulations! You made it to the last step. That wasn’t so bad, right? Now, I want you to open up a new tab and check your bank account. How much do you really have available to spend? You don’t want to run yourself into debt that you’ll struggle to pay off. Take another look at each item on the budget you just made and see where you may be able to cut back. This doesn’t necessarily mean that you have to cut people or events from your list. Just see if you can spend $5 less on a few people’s gifts. Consult your budget while you’re shopping, and you’ll be more inclined to look for good sales and deals.

ProTip for next year: Before you make any big changes to your holiday budget, remember what that initial total was. Take that number and divide it by 12. Create a new savings account and deposit that amount each month into it. By the time next holiday season rolls around, you’ll have all the money you wanted to spend and be able to gift and celebrate the way you really want to.

If you’re interested in other budgeting and personal finance tips, visit the Finance tab at genuinesunshineblog.com/category/finance. You can also find my other budgeting templates here: https://genuinesunshineblog.com/you-need-to-have-a-budget-5-steps-to-start-one-today/

If you like what you read here, follow @genuinesunshineblog on Instagram and look for new posts here at genuinesunshineblog.com every Sunday to start your week with sunshine!

Cheers!

Sarah