BlackbirdWhether you’re on a tight budget this year or you’re just trying to be more conservative with your spending, it’s smart to create a Christmas budget. Budgets put you in control of your spending. They can make the holiday season much less stressful. Additionally, they help you communicate your spending goals and limits with your other family members. Here are four tips to help you create a Christmas Budget.

#1 Create a list of expenses. One of the reasons the holidays can get so expensive is because there are unforeseen expenses that pop up.

For example, all of a sudden you’re doing a secret Santa thing at work, or your children are doing one in their classroom. Maybe you forget to add your child’s teacher or the babysitter to the gift list. Or maybe you’re invited to a holiday party and need to bring a hostess gift. Creating a list of expenses forces you to think through all of the possibilities.

And if you create a category and don’t actually use the money, you can always put it back in the bank or transfer it to another category.

#2 Make it official. It’s tempting to just draft a budget in pencil on a piece of notebook paper and consider the task of budgeting accomplished. However, half of the benefit of a budget is as a tracking tool. You’re likely going to lose that piece of notebook paper, spill coffee on it or just toss it. When you make it official you’re ensuring that you’re more likely to stick to that budget. It’s worth it; debt isn’t fun.

Create a spreadsheet or a special notebook if you really do love the pen and paper idea. There are also handy budgeting worksheets available online. Create a formal budget and a system to track your spending so you can stay on top of your money and in control.

#3 How much can you afford? Once you’ve found a system and created a list of expenses, you can start allocating the money you have to spend to each category. This is often the frustrating aspect of a budget, because we feel there just isn’t enough. There is enough and you’ll feel better staying on budget – promise.

If necessary, get creative. When you budget you may realize that you’re going to have to make your holiday cards. Great! You may also realize that instead of buying your child that new computer, they’re going to get a used one. No problem – really, it isn’t. Budgeting helps you focus on where and what you can spend.

Be creative, accommodate your finances and don’t judge yourself. If you find you’re dreadfully short on funds, brainstorm a way to make a bit more cash. Sell stuff on eBay or do some freelance work. You can do it!

#4 Track your spending. No budget is effective without actually tracking your spending. Keep your receipts and enter your spending daily. This is the only way you’re going to control your cash. Get everyone on board and create a central location for receipts. Show each family member involved in holiday spending the system you’ve set up to track expenses.

Creating a holiday budget is smart. Once the season is past and you don’t have any debt, you’ll be committed to creating a Christmas budget each and every year. It’s that effective!


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