HOW TO HAVE A DEBT FREE CHRISTMAS
In today’s article we are going to show you how to have a Debt-Free Christmas so that you don’t end up with the January Budget Blues.
How much will you spend on the holidays this year? If it’s close to $1,000.00 then you are pretty much average. It goes without saying that the holidays and holiday spending can be a budget buster.
And it’s not just the gifts that are purchased, there is extra money that goes into the food budget, into holiday decorating and electricity (do you have a Clark Griswold in your family?), traveling, getting the carpets cleaned and other purchases that are made to make the holidays picture-perfect. And that’s what we all want, right? Is to create a feeling that will last.
There is nothing wrong with that!!!! But let’s all do it in a way that also doesn’t derail our financial well-being. So how do you do that?
12 TIPS THAT WILL HELP YOU HAVE A DEBT FREE CHRISTMAS
THE DECEMBER DILEMMA
We do not want the “high” of the holidays to be followed by the January Budget Blues when the mail carrier delivers the credit card statement and what we thought was just a few bucks here and a few bucks there has multiplied into a bill that cannot be paid off immediately.
Did you know that a credit card balance of $1,800.00 with 11.99% interest being paid at $100.00 a month will take 20 months to pay off? Do you really want to be paying for last year’s Christmas next Christmas?
The other danger is that holiday gifts are purchased at the expense of your current budget.
TIP 1. SET A BUDGET
The easiest way to be ready for the holidays is to simply budget for it and put money in an account or some other stash where you can keep it and keep adding to it throughout the year.
How does this happen?
If you have not budgeted for your holiday purchases and you don’t have any sources of extra income to pay them, then it logically follows that the money for those purchases is going to be at the expense of something else in your budget. The cost of this? Late fees, NSF fees, playing catch up for a few months into the New Year is not how you want to start the New Year.
So what to do? Use our Christmas Budget Worksheet! It has space for all of your holiday spending.
TIP 2. STICK TO THE PLAN
PLAN!!! You know what they say, “those who fail to plan, plan to fail!”
I know…the holidays seem to sneak up on us every year – but it’s really more about poor planning on our part, isn’t it? The holidays are not one of those sneaky holidays that change every year.
Each year they are in December – EVERY DECEMBER.
So, stick to your plan and use your lists. Need help with your list? The 4-Gift Challenge is a GREAT way to stay on budget.
3. THE 4 GIFT CHALLENGE
One way our family has opted to keep our Christmas budget under control, especially since adopting all the boys, is to do the 4-Gift Christmas Challenge.
The Challenge is simple…for each child, we purchase something they Want, something they Need, something to Wear and something to Read. It has been such a cost saver for us and each child gets a mix of presents we can feel good about giving.
TIP 4. MAKE EXTRA INCOME
Especially if you already have a tight budget, creating a little side income is a great way to put money back into your budget for your holiday spending. You can get a seasonal job to pay for the extra holiday expenses. In today’s “gig-economy” there are plenty of new ways to earn income as well as online opportunities to earn more money.
If you need ideas, we have a few for you.
TIP 5. BUY GIFTS THROUGHOUT THE YEAR
I have to admit, I am TERRIBLE at this. But I know others are are masters at buying gifts throughout the year. It is a great way to spread out your spending so its not one large spend in a short period of time. If you do this, keep a running list throughout the year to stay organized.
TIP 6. MAKE GIFTS IN BULK
This is one of my favorite things to do during the holidays. We have so many people we want to do something nice for – but not always is it in the budget to get gifts for everyone. BUT – making our friends, family, neighbors and others is a great way to give them something thoughtful and practical.
As an example, we came up with 10 DIY gift ideas for the teachers in your life. But you can do many of these ideas for other special people in your life. Also, who doesn’t love a tin of homemade gingerbread or sugar cookies? I know I also appreciate the thoughtfulness of a yummy baked goods. (Maybe too much! LOL)
TIP 7. SELL STUFF
How much stuff do you have hanging around your house that you are not using? The holidays are a GREAT time to de-clutter and sell unwanted and unused items and convert them to cash. We do this at least once a year and can usually net, at a minimum, a few hundred dollars. Make a game of it and see just how much you can get. Your trash really is someone else’s treasure.
TIP 8. SAVE UP REWARDS AND GIFT CARDS ALL YEAR
Many of the cards you are already using have cash back rebates. Why not use your credit cards to pay for monthly expenses, pay them off every every month and take advantage of your cash back rewards. Then save up your rewards all year long and cash them out at the holidays. Many store cards do the same with rewards and/or gift cards.
TIP 9. THE DOLLAR STORE
The dollar store is a gem when it comes to getting many holiday items at a super discount. It is one of my favorite places to get stocking stuffers. But did you know you can also find great decorating materials, gift wrapping and even dishes! This year was a really tough year with a pandemic and I didn’t have a full place setting (my kids have broken or chipped just about all my dishes!). I was able to find beautiful white square plates that were perfect for my holiday place setting. $12.00 for 12 plates! And they looked amazing!
TIP 10. BE OK WITH SAYING NO
This is a learned skill. It is hard to learn, but trust me, when you finally figure out how to say no, it will make your life so much easier. You don’t have to go to every holiday party, participate in every gift exchange or buy gifts for all your nieces and nephews. We decided many years ago to stop feeling obligated to do everything we were asked to do and the relief of not having that pressure and expense has been very freeing. Tell your family this year, you will not be giving gifts. They will get over it. And if you really feel like you need to do something – do a family gift – that you’ve made instead of purchased.
TIP 11. USE CASH
Studies have shown that we spend less money when we use cash. It’s a psychological thing. It hurts to let go of cash and easier to swipe a debit or credit card. So fill up your holiday cash envelope and take it with you when you shop. Not sure how to use a cash envelope system? We have you covered there as well.
TIP 12. SHOP ONLINE
Finally, one last tip to save more money and stay debt free this Christmas is to shop online. Part of going out in to the stores to shop is the danger of impulse buys. Use your list and shop online to avoid impulse buying. Stores are purposefully set up with merchandise to target you and increase your spending. Avoid all of it by shopping online.
If you have committed to using cash this holiday – and you also want to shop online, just make sure you deposit your cash back into your account after you make your online purchase.
You can do this!
We have opted to budget for our Christmas for the past several years and limit the amount we spend on gifts.
What is interesting is that as we get further along in our debt repayment the desire to spend on gift-giving has decreased. We would much rather see our debt reduced than a bunch of boxes under the tree.
THE CHRISTMAS SPIRIT
I would be remiss if I didn’t mention that one of the greatest ways to put the holidays, and what is really important about them, into perspective is by sharing it with others and by finding a way to serve someone, anyone, during this season.
You want to create memories for your kids? You want to teach them about what is most important in this life? You want to teach them responsibility and to appreciate all that they have?
This is how it’s done. Serve with them – shoulder to shoulder. Serve in a shelter, deliver food to the homeless, adopt a needy family and deliver presents to them, visit a hospital, there are so many possibilities and opportunities to serve.
What’s up with that? A message about serving in the middle of talking about holiday debt?
Here’s what I am getting at. It’s a paradigm shift.
It’s getting off the crazy train of debt. It’s realizing that what you have IS enough and you don’t need more “stuff” and even if there is some “stuff” you really, REALLY, want…you have to want to be debt free more.
You have to reach a point where you are satisfied and a really powerful way to create contentment in your own heart is to pour into other people.
It’s really difficult to have everything be about YOU when you are staring into the face of someone else who needs help – it becomes crystal clear that it is not about you – but THEM. When this shifts for you, something happens and your spending will decrease, which means more funds available to attack your debt and get off the crazy train of debt for good.
A happy DEBT FREE holiday to you all!
Love and Prosperity,
Wendy and Curtis
We’d love to be able to support you. Come join our Facebook Group.