Personal Finance 

Finances in 55: Start Getting Ready for Christmas

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christmas treeIt seems like it might be a little overkill: Start getting ready for Christmas already? However, for many of us, Christmas is a very expensive time of year. There are gifts to buy, the house to decorate, people to entertain, and many of us even spend more on festive food and drink for ourselves during the Christmas season. When you consider the extra strain to your budget, it makes sense to start preparing for Christmas a few months in advance.

Before you scoff at the idea of getting ready for Christmas, take a little less than a minute to review what you might need to do during the holiday season. No one’s saying you have to run out and buy new ornaments now; just think about what you might need. Here’s how to evaluate your Christmas season readiness in 55 seconds:

  1. Take mental inventory of what you have: Take a few seconds to think about what you already have: Decorations, left-over bottles of bubbly from New Year’s, toys stashed in your closet that you haven’t gotten around to giving to your children. Think about what you already have so that you aren’t planning for duplicates. (25 seconds)
  2. Consider what you might need this year: Next, consider what you will need this year. Quickly run through the list of people you will need gifts for, and think back to whether or not any lights went out and need replacing. Also, consider whether or not you will be hosting a Christmas party, and what you might need for the party. (30 seconds)

This exercise is fairly simple, but it will help you think about what you might need to do to prepare for the holiday season and get ready for your holiday budget. And you might need it; I know the Christmas season tends to sneak up on me rather unexpectedly.

Preparing Your Finances for Christmas

Think about what you spent last year at Christmas time. If you have good records, or personal finance software, refer to this information. This will let you see how much you might expect to spend this year. Depending on how many months you have (I like to count September, October and November), you can divide that amount. If you spent $500 last Christmas, and you figure you have three months to get ready, you will need to set aside $166.67 for each of those months. When December rolls around, you will be prepared without breaking your budget.

If you aren’t sure how much you spent last year, you can estimate your costs and gauge as best you can. But this year, keep track. Make an effort to take notes on how much you spend, and what you spend it on. Start a “Christmas fund” in a high yield account so that you can more readily handle costs. You can also create an inventory of Christmas decorations in order to avoid getting too many duplicates.With a little organization and some financial planning, you will be a little more prepared for next year, and you can plan ahead in a way that helps you avoid breaking your budget each time the holiday season rolls around.

(Photo: premiumkopi)

{ 9 comments, please add your thoughts now! }

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9 Responses to “Finances in 55: Start Getting Ready for Christmas”

  1. Stefanie says:

    I already have all my major holiday gifts purchased – gift cards. There was a special promotion 2 months ago at a grocery store where if you bought $100 in gift cards, you got a $20 coupon for use in the store, so between my partner and I we bought $300 in gift cards – which cover this years holidays as well as next the rest of this year’s and many of next year’s family birthdays. We live 3000 miles from our families, so gift cards end up being an excellent choice – easy to ship and it makes everyone happy.

  2. Best financial planning you can do this Xmas is agree with your family on limits…prepare your children to pick their “top 3” items,and that Santa picks from that list. So often our overspending on the holidays comes from pressure to not look like the “cheap” giver…so come up with a collective agreement up front…and you’ll all emerge the holidays with more joy, less stress and definitely less spending.

  3. Laura says:

    Planning now isn’t just about the money, either. for the first time, we will be sending out photo christmas cards. i’m already researching who we are going to use and the format of the card. I want to get the addresses ready. That way when the time comes, all I’ll have to do is insert the photos. I could say i’m doing things like this to get a better handle on my budget, but i’m not. I don’t want to be stressed or rushed so I’m being prepared well in advance.

  4. Josephine says:

    This year I am all ready trying to see where to put the tree up. I will have 15 month old grandson running around, I don’t want to knock down the tree.Plus , I have grandkids to get for plus little odds and ends to buy.

  5. Shirley says:

    I guess I prepare for Christmas all year long, the same as I prepare for any other day. A large family gathering with our traditional potluck and shrimp gumbo has me automatically buying four pound bags of frozen rock shrimp whenever I see it on sale throughout the year. Our gifts will be deposits to savings accounts for the grandchildren and checks to the adult children. (They know better than I do what they want or need.) The focus will be on family fun, visiting, laughing and just truly enjoying one another.

  6. lostAnnfound says:

    I start my Christmas savings account the year before I need it. It gets paid out to me after November 1st and then I restart it that month to save for the following year. I usually don’t shop much throughout the year, mostly do it after Thanksgiving, but I don’t have to worry about where the money is going to come from because I already have it set aside. I find it so much easier saving a few dollars every week through the year than trying to come up with a big chunk of money in a month or two before the holidays start.

    • Sarah in Alaska says:

      I too save all year long. I like to have a smooth/flat budget so I do have holidays as a line item all year.

      • Strebkr says:

        This is why I love the sub accounts in ING. We can throw a fixed sum each month into that pot and withdraw it at Christmas time to help smooth out the higher credit card bill (that always gets paid off each month)

  7. Eyedea says:

    I am so glad that I am not alone in the holiday frenzy!! Since becoming a single mom many years ago, I have found it better to prepare EARLY. I have already bought gift cards for my son, brothers, nephew and mom. My son is 18 but I still have have him post his wish list in August and add to it during the following 3 months. I also teach summer school or write curriculum in the summer and slam the money into a savings account that does not get touched. I plan waaay ahead so that we can afford to have all the outings we wish, go to parties and visit without being empty handed. It makes me happy to bring gifts when I visit during the holidays. I also have lots of small but useful gifts wrapped up to give to those who visit me during the holidays. I like to relax and chill on the holidays instead of worrying about finances.

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