My Christmas Budget

I find it humorous how every year I am surprised when the holidays roll around. Once the stores start decorating for Christmas we’re all like What?? Christmas ALREADY?? as if it isn’t the exact same day year after year.

It’s so easy to get out of control and spend more than you intend to at Christmas, isn’t it? The season of giving turns into a competition of who can spend the most, and a lot of times we end up in January with a new sweater and a very low bank account.

After a few years of stressful, penny-pinching Decembers, I now include in our monthly budget a little bit to set aside throughout the year to spend for Christmas. It has helped me enjoy this season a lot more and be more strategic in the gifts I give. (If you don’t save throughout the year, don’t panic. Here are some tips for how to pay for Christmas when you haven’t budgeted for it.)

My Christmas budget categories look like this:

  • Gifts for family members: We normally spend $20-40 per person (depending on the gift), so this is the largest bucket of the budget. I try to save as many gift cards and coupons to use for Christmas as well. (So far I’ve purchased three gifts this year using credit card points. Score!)
  • Small gifts for friends, coworkers, neighbors: I don’t give big gifts to my friends (we decided we all had too many other people to buy for!), so usually I bake bread, cookies, toffee or give a bottle of wine to local friends, coworkers or neighbors.
  • Decorations: Christmas tree, wreaths, lights, candles, etc. I try not to buy too many decorations, since we have collected a lot over the last years, but this is one area I always seem to buy more than I originally intend to. It’s fun having a festive home!
  • Christmas cards and stamps: Not everyone sends these out, but I enjoy giving (and getting!) holiday cards in the mail. I am using Minted.com this year (click on the link for $25 off your order) and plan to order a postcard so the postage costs less.
  • Wrapping paper: Boxes, bags, and wrapping paper are pretty cheap, but add up when you have a lot of gifts. I also try to buy wrapping paper after the holidays on discount so I won’t have to spend as much when the season approaches, but normally still have to spend money on these.

Other: We pay for these things out of our normal December budget, but you can also include an Entertaining category to your Christmas budget if you host a lot of parties or dinners, or an Entertainment category, if you intend to see the Nutcracker or A Christmas Carol, or other holiday-related events each year.

Normally I track my Christmas budget in a boring spreadsheet, with the categories, budgets and gifts I buy all listed together. A little boring, but I love my spreadsheet system.

If you’re not a big fan of Excel, I just discovered Dave Ramsey’s My Christmas Budget, an interactive site to keep track of all your expenses, itemizing it down to the person you want to buy for, decorations and charities you plan to give to. If you don’t have a system for planning a Christmas budget, I highly encourage you to use is, as it’s a lot prettier than a simple spreadsheet. :)

my christmas budget

Do you set aside money each year for Christmas?
What other categories would you include in your budget?
Do you like to buy your presents ahead of time, or wait until the last minute?
How much do you spend per person in your family?

PS – I wasn’t paid by Dave Ramsey for promoting this, just think it’s a good tool. But Dave, we should talk.



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  • Michelle’s Finance Journal

    I’ve been buying Christmas presents for the last couple of months and I’m almost finished~ This year’s the first year I planned ahead on Christmas presents and because I gave myself enough time, I was able to take advantage of sales and promotions. I was also able to think about the people more trying to figure out what they’d like. http://michellesfinancejournal.wordpress.com