Ahh, Christmas. The best time of the year. Some might disagree here – so many of us have become virtually allergic to the whole gift-o-mania, jingle bells and commercial shenanigans. I, however, love Christmas. I love decorating, lighting candles, drinking mulled wine, and watching Love, Actually. The whole nine yards, ye know. This year especially has shown us how precious life is – how precious time is – and my intention is to enjoy every.single.day.
However, Christmas can be a tricky time financially. Presents, cooking and entertainment tend to leave us broke at the beginning of New Year, which is a nasty place to be, and can be easily avoided with some careful planning. Budgeting for Christmas should ideally start in October, and if you have done so and managed to buy some gifts during Black Friday – kudos to you. I don’t believe in Black Friday, but I’m really good at budgeting, and I’ll be sharing some steps to survive the holidays and not be broke.
- Look at your income: how much are you receiving in December? Are there any bonuses your company is paying you? Maybe you’ve lost your job and you have less than before. Don’t worry – Christmas will not be cancelled, we’ve gotta make do with what we have.
- Immediately deduct your rent, bills, regular grocery shopping, and mandatory expenses.
- I hope you’ve got an emergency fund/savings account set up – if not, do it know. No, do NOT wait till next year. Do it now.
- What’s the plan for Christmas? Answer some of these questions:
- are you travelling somewhere?
- do you need new decorations? Are you buying a real Christmas tree, or do you use a good artificial one year in, year out?
- Are you cooking? Or are you visiting other people who are cooking?
- Are you making presents? To how many people?
- Will you be attending any events? How formal are they?
- Based on your answers, decide on the budget for gifts, decoratons, travelling, beauty/outfits, and dinners. Start with the MINIMUM possible for each category!!!!
The current Covid situation varies from country to country, but here in Spain gatherings are allowed for up to 6 people, and bars/restaurants close at 22. I know countries where restrictions are a lot more lenient, and during Christmas travelling internationally or from province to province will be allowed to visit family. Wherever you are when you’re reading this, Christmas will most probably be different – and it has its upside because most probably, you’ll be spending a lot less money than usual!
I’ve divided the budget planning into 5 different categories, as mentioned above, so let’s tackle all of them one by one.
Travelling
I sure hope you have your plane tickets sorted. Even if you don’t, they are quite cheap this year, so even if you decide to fly somewhere out of the blue, or just escape Christmas, it shouldn’t punch a huge hole into your pocket. Maybe you’re just taking the train to a different city in your own country. Put it in the budget anyway!
Decorations
I’m one of those who recycles her baubles and wreaths until they literally fall apart. Aaaand… they’re all tiny, so they never cost too much in the first place. Of course, many of you will one to zhuzz things up a bit every time and get some new cool flashing lights and aromatic candles and disco balls, or whatever Pinterest has put into your head. While I’m all for using Instagram and Pinterest for inspo, sometimes they just make me want things I don’t need.
Entertainment
It’s allowed to go places, even with the current restrictions. The amount of people may vary, but you will have occasions to spend, on going out, and possibly look pretty. Try to figure out how many times you’ll be going out, and how formal those outings will be. If you’re going out with your boo, bae, SO, new or old – I think you deserve a new dress. Or a new set of lingerie. Or… a perfume. I know I do, and I’m definitely having it all, even if I’m not setting a foot outside of my own flat. Decide how much you are willing to spend on eating out plus beauty and new clothes, and add it to your budget.
Gifts
How many people are you making gifts for? Try to reduce that number to the absolute minimum, totally guilt free, and just send the rest a nice post card. Bonus points if you can make it yourself. It’s not because of coronavirus and difficult times, even though that does play a part. Do it because it’s reasonable. Keep doing it even when Covid is over. I used to overspend by trying to get “little gifts” to everyone… But what’s the point? Christmas IS a time for giving, but we can give non-material things, too! Love. Attention. Time. Sometimes popping out for a cup of coffee and spending some quality time, or having a longer session over Zoom is worth more than a haphazard gift you’re making just because.
Dinner
Now the best part. At least for me, because I’m quite a little glutton. If you’re cooking Christmas dinner, think of how a) what’s on the menu and b) how many people will attend (even if they trickle over the course of 3 days). That should give you an idea of how much you’re supposed to spend. Also, are you cooking/baking for other people? Going over to Mum’s with a chocolate cake? Taking some goodies to share with colleagues at work? Factor that in, too. (Alternatively, you can put cooking for others under the Gifts category.)
I’d also think about over-indulging: you know, all those bottles of mulled wine, snacks, sweets, hot chocolate and marshmallows… I watch Nigella’s Christmas and she always makes me drool over toffee puddings and cheesecakes and eggnog… Mmm…. Shove it all into the Christmas Dinner budget. The whole month is basically one big Christmas dinner – enjoy it!
Other tips
Re-gift your presents. Don’t like that pair of socks? Give it to someone who’ll appreciate them. Boo gave you a perfume that’s not really “you”? You know what to do.
Sell some items to make extra cash. People will be buying now more than ever – take advantage!
Use cash back apps. Ideally you should’ve started some time ago to be able to cash in for Christmas.
Collect points in your local supermarket, Sephora, etc. I earn around €4o worth of points at my local grocery shop over the year, and I always use them at Christmas. It’s just me and my boyfriend mostly, which basically means free dinner for us – but if you’re cooking for more, reward points are a great way to save some cash during holidays. Same goes for any store your’re a client of.
Make shared gifts rather than individual. It makes more sense financially to buy one item for multiple people. I know that sounds so scrooge, but think about tea sets, cheese boards, or other homeware, and things like arts and crafts: they’ll be good for a couple, or sometimes for the entire family. Be smart – optimise price per gift.
You see? It’s totally possible to have a great Christmas and keep your balance positive. It’s mostly about negotiating with yourself. I know there are expectations – there are traditions – there are habits. That you’ve been doing things in a certain way doesn’t mean they can’t change. But ultimately, you decide what to do with your money and how to spend it. Christmas, or any holiday, is not a reason to go bankrupt. Life goes after the holidays, and what feels better than welcoming 2021 will a smiling bank account?