Financially Preparing for the Holidays
You KNOW the holidays are almost here. You’ve been inundated with ads since before Halloween. Christmas music has been playing on the radio for almost a month. Black Friday, Small Business Saturday, and Cyber Monday have come and gone. But just in case you haven’t already spent all of your money on holiday gifts, here are some questions you should ask yourself when planning your budget.
Who are you buying for?
Regardless of what Capitalism tells us, you don’t actually have to buy a gift for everyone you know. If you can’t afford to buy gifts for everyone who is important to you, you have to prioritize. So, who are the people you absolutely want to buy gifts for this year? You can make a tier 1 (must gift) and tier 2 (maybe gift) list, based on what your budget will end up being.
If you have a really big family (like I do), it might be completely unreasonable to get a gift for every single person. A great solution that my family came up with is this: throw everyone’s name into a hat and have each person pull a name out. That is the person they have to buy a gift for that year. It seriously cuts down on spending and takes a lot of the pressure off.
How much do you have to spend?
Be realistic. How much money can you spend without going into debt or not being able to pay your rent in January? Make sure that you’re accounting for all of your fixed expenses (and things like food) when you’re deciding your budget. You want to be able to pay your rent on January 1st.
If you’re disappointed with the amount of money you have (or don’t have) to spend this year, start planning for next year. I like to set aside a small amount each month so that I will have plenty to spend on gifts throughout the year. Adding this line item to my budget has been a game changer when it comes to holidays and birthdays. I now know that I’ll always have at least a little bit of money set aside for gifts, so I never have to bust my monthly budget.
How much can you put aside each month to prepare you for next December?
How much can you spend on each person?
So now you know how many gifts you want to buy and how much you can spend total. That pretty much determines how much you should be spending on each gift. If you want all the gifts to be fairly equal in cost, divide your total budget by the number of people you’re shopping for. If you know that you’ll want to get something bigger or more expensive for one person, and smaller gifts for the rest, allocate accordingly.
What is influencing you to spend money?
Are you feeling pressured to buy gifts? Where is that pressure coming from? Figure out if it’s a sincere desire to make that person feel special, or if there is another, less authentic, reason. Everyday, we are inundated with commercials and other ads telling us that we have to buy, buy, buy. This often makes us feel resentful or overwhelmed, and for many people, it results in debt.
Spending money on someone is not the only way to show that you care, and it’s not the most important way! Some people’s love language is gift-giving and/or receiving gifts, but others aren’t wired that way. So get clear on why you want to buy gifts, how you think it will make your loved ones feel, and then focus on how to make it happen (or not).
Are there low-cost or free gifts you can give?
Okay, maybe you’ve decided that you do want to give a gift to all of your close friends and family. That’s so generous! But assuming you don’t have unlimited funds, you’re going to have to get creative. Brainstorm some things that are inexpensive or free that you can give as gifts. You don’t have to spend a bunch of money to make a gift worthwhile and thoughtful.
One thing I like to ask people is: what is something that you’re really good at? What do people compliment you on or ask you for? If you find your friends constantly asking you to bake cookies for them, maybe your gift this year can be an assortment of your favorite Christmas cookies! (Side note: I’m always accepting peanut butter blossoms.) Or maybe you really have a way with words and your mom would be happy with a thoughtful card instead of an expensive necklace.
Other inexpensive gift ideas:
- A framed picture of the two of you
- Homemade jewelry
- A home-cooked meal
- A knitted hat or scarf
- Quality time together
- A book
- A bottle of wine
- A beautiful house plant
How well do you usually budget around the holidays? Have you found creative ways to show your love? Share in the comments!
This post was originally published on MaggieGermano.com and shared with permission.
Maggie is a Certified Financial Education Instructor and financial coach for women. Her life’s mission is to give women the support and the tools that they need to take control of their money, break the taboo of discussing debt and income, and achieve their goals and dreams. She does this through one-on-one financial coaching, monthly Money Circle gatherings, and speaking engagements. Passionate about many issues affecting women, Maggie also serves on the board of Collective Action for Safe Spaces, is a member of Planned Parenthood of Metropolitan Washington’s Developing Leaders Program, and was trained as a salary negotiation facilitator by AAUW.