Some things are totally worth going into debt for! I can't think of exactly what right now but I know for sure that CHRISTMAS ISN'T ONE OF THEM.
I know you don't need reminding, but if you overspend at Christmas it puts you on the back foot for the New Year immediately. And that's a sucky way to start the year right?
And as fun as it can be, Christmas can actually be a massive stress - whether you have money or not.
When you're struggling to make ends meet it's even harder. And if your loved ones don't understand that you're under financial stress, trying to keep up appearances can be a big source of anxiety.
How to spend less and not ruin Christmas completely
But how do you spend less on Christmas, without totally RUINING it for everyone?
People have expectations...
You can't tighten the Christmas purse strings too much without pissing people off. So, any reduction of spending on Christmas related things - must be done extremely carefully. Or this...
7 Christmas boundaries you can try
If you want to reduce money spent at Christmas, try setting some boundaries and come up with some alternatives. For example:
- 1Dollars Per Person Boundary: put a limit on money spent per person. If you usually spend "$50 to $100", then put a hard limit of $50 on it. If you usually spend $50, spend $30 instead.
- 2Proximity Boundary: Could you agree with your family to only buy for each other if you're spending the day together?
- 3Quantity Boundary: If you have a BIG family get together, then number 2 might not suit. In that case, you could do a 'Secret Santa' for the adults, where one adult buys ONE gift for one other adult, all the adults get one gift each. Everyone gets to open a gift, and no one is left out. But you're not broke.
- 4Inner Circle Boundary: If you usually give gifts to your hairdresser, the kids teachers, the mailman, etc... and you just can't bear to stop, could you handwrite them a thankful card instead? Chuck in a couple of individually wrapped chocolates for good measure.
- 5Generosity Boundary: But seriously, stop buying gifts for every single child you know. I used to do this and I realise now it just made the parents feel awful if they didn't reciprocate. Awkward.
- 6Reciprocal Boundary: If there is someone you really feel obliged to reciprocate - talk to them, "I love it how you always think of me/my kids every Christmas. It makes us feel so special, but your company is enough for us! We're so lucky to have you in our lives."
- 7Merchandise Boundary: Could you give the gift of time, skills or experience instead of merchandise? Or break the mould and give them an experience in place of their 'big gift'. This could be something the whole family does together.
Christmas spending boundary #7: give the gift of time, skills or experience instead of merchandise. See the rest here:
What if you've already overspent...
If you've already overspent, and it's just not going to be possible to recover your finances this Christmas, DON'T beat yourself up.
But DO start planning for next year. Here's how:
Step 1 - Open a Christmas bank account
Jump onto Internet Banking and set up a Christmas 2019 account TODAY.
Step 2 - Put $5 in it immediately
Transfer $5 into your new Christmas account. This 'breaks the seal' on the savings habit and immediately, you've made some progress.
Step 3 - Add up your Christmas spending
This might be painful but it's important. After Christmas is said and done, tally up everything you spent on gifts, postage, food, booze, travel, accommodation, decorations. EVERYTHING. This is the target you should aim to save by next Christmas. If you balked at the amount, lower it to a level you're comfortable with. Once you have that total, move to the next step. This is your Ideal Christmas Spend total.
Step 4 - Work out your monthly savings target
Take your Ideal Christmas Spend total and divide it by 12. If it's $1,000 that equals around $84. That's the total you'll need to budget every month, for next Christmas. Add this to your budget.
Step 5 - Set up an automatic payment
Now jump back onto Internet Banking, and set up an Automatic payment for that amount, to go straight out of your account on pay day - into your Christmas account. Set and forget until next Christmas.
Now for a Jedi mind trick
Now for a little mind trick. Imagine if you had done this last January. If you had put away some money every month especially for Christmas?
If you had $500 in savings for THIS Christmas would it have helped you to avoid tapping your credit card/store cards/Afterpaying? Maybe!
If anything, you would have had $500 saved to put towards Christmas. That' can't be a bad thing huh.
Your choices right now
My key message here is this: if you need to create debt for Christmas, then you're either spending too much (for your current level of income and expenses), or you're not planning far enough ahead.
So you have a choice: either spend less, or plan further ahead.
There are 12 months between each Christmas, so in that time you can ferret away some cash to take the pressure off, so that you can ENJOY Christmas and not dread it.
Share your own tips in the comments
What do you do to keep costs down at Christmas, without making it sucky? Share in the comments!
Or check out some money saving gift buying tips on The Penny Hoarder.