How to Make – and Stick to – a Holiday Budget

Christmas comes once a year, and if you’re like many people, you’re still dealing with your Christmas bills well into next summer. Most people would be surprised to learn just how much they spent celebrating that one day. And many are, once they open the first credit card bill after the holidays. If you don’t want that to be you come January, take some time to make a holiday budget and do everything you can to stick to it.

Set Your Budget

Click here for a Budget Worksheet

Decide early how much you’re going to spend. If you’ve set up a holiday savings account, wonderful. If not, then you need to work with the income that you’ll be getting during the shopping season. Use your monthly budget to figure out what you’ll have left over after expenses. Then, use that to build your holiday budget by category: gifts, travel, food, decorations, clothes, and donations.

Prioritize Your Spending

Decide what’s really important. We tend to go overboard on spending for the holidays when just a little discretion would have kept us within budget and out of debt. Second-guess every purchase you make to be sure you can afford it.

Track As You Go

As you spend, make sure you adjust your budget so you always know what you have left. Set aside some cash or use a prepaid credit card for all your holiday spending. That way, you won’t mistakenly overspend or use up money that was allocated for your mortgage or electricity bill.

Resist Guilty Spending Temptations

Don’t feel obligated to do extra over the holidays. Do your best and remember, it’s the thought that counts. Even if you can’t do everything you’d like this year, you can start saving early next year so your next holidays will be even better.