Set a Holiday Budget in 5 Easy Steps
For many, the holidays are the most joyous time of the year, but purchasing gifts without a budget can quickly sour your holiday spirit. Instead of feeling glum this holiday season, plan your budget for gifts and other expenses that come with the season, just like Santa meticulously plans his route.
Take these steps to create a budget and make this holiday season a breeze.
- Choose who you are giving gifts to. Sharing gifts with others can be fun but remember that it’s impossible to include every single person you know. Make a list of the most important people in your life and decide who you’ll buy gifts for.
- Determine how much you can spend and then break down the cost. Look at your spending habits from the past few months and analyze your upcoming expenses. This will give you a good picture of how much income you can spare for gifts. Once you’ve decided on that number, divide it up by how much you’ll spend on each person on your gift list. You can do this on a sheet of paper, on your phone, or on an Excel spreadsheet. Choose whichever system makes the most sense for you and your lifestyle.
- Decide what you’re going to buy (or make) for your loved ones. Before you enter a shopping frenzy, carefully consider what you want to give each person on your list. Sometimes stores add flashy “sale” signs that encourage you to impulsively purchase items that you weren’t originally planning to buy. From the comfort of your home, consider what you want to gift each person on your list. Once you’ve decided, then you can go into stores and you’ll be less likely to be baited by sales. Remember, too, that handmade gifts are often the most heartfelt. If you have a special skill for woodworking or card-making, put that to use as you’re crafting your gifts for the year.
- Begin shopping! Rather than buy everything in one large trip, thoughtfully shop sales throughout the season to get the best deals for everyone on your list. Even if your holiday budget is tight, shopping sales will help you make the most of every dollar for your loved ones.
- Give your gifts and begin planning for next year. Once you’ve given each gift on your list, you can release a sigh of relief, and then begin planning for next year. A savings account, like Rudolph’s red nose, can light the path during tough financial times, both during the holiday season and year-round. Consider opening a savings account now to give yourself a financial cushion for when the unexpected eventually hits.
The holiday season can be overwhelming between planning and attending family gatherings, decorating your home, and buying and giving gifts, but by planning early and meticulously, you can help set yourself up for financial success this holiday season.
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