Now that you have decided on a Holiday Spending Budget, what's next?
First, figure out specifically where is the money to fund this budget coming from? Before you spend a penny on the Holidays, you need to decide where you are getting the dough from.
At our house, we have decided on a budget of $1000.
It is an amount we can afford. We will pull it from whatever we save in November for our $30K Savings Challenge. Since we are ahead of schedule saving money to put into that fund, we can spare this amount.
If we didn't have it to pull from there, we would reduce other variable expenses this month and use the extra cash that would free up for the Holiday spending budget. We would NOT pull the Holiday spending money out of either an Emergency Fund(the Holidays are NOT an emergency!), nor would we whip out Credit Cards and pay for Christmas with money we have yet to earn.
If we had no extra cash to put toward the Holiday spending, then we would sell something(on eBay, Craigslist, bulletin board at the grocery store, etc.)or bring in extra money with a side job(babysit, dog walk, recycle bottles/cans/scrap metal for cash, tutor, bake and sell cookies door to door, deliver pizzas or flowers part time, get a holiday part time job, etc.).
If you get creative, there are ways to acquire what you want to do/give at the Holidays without going into debt. Try finding ways to get the things you need/want without money or for less money. Barter. Buy used. Reuse what you have.
Your enjoyment and satisfaction at the Holidays should Not be dependent on how much money you spend!
And if you ARE in debt, please think long and hard about how much you are spending for the Holidays.
And don't put it on a credit card and dig yourself a deeper hole to get out of....please.
If you haven't taken your total spending amount and broken it down into each of the categories that you will spend money on for the Holidays yet, you should do that next.
Anyway, here is my prioritized Holiday list and how we are initially allocating the funds.
Traveling to visit with Family. $300
Sending a few Holiday Cards. $10.80
Shopping for and exchanging gifts with family. $400
Cooking Christmas dinner. $30
Charity. $100
Baking cookies and pies. $20
Christmas Tree. $5
A Christmas eve meal and show or movie. $125
$300 *Traveling to visit with Family----
The plans are still up in the air. If we go, we will be staying with family so the bulk of that spending is for gasoline and some travel meals. There is a small cushion to cover any fees/expenses at the destination if we go somewhere or do something that costs money. We don't plan on it but you never know what your hosts will want to do.
$10.80 *Sending a few Holiday Cards----
I have enough cards to last for many years(bought on Xmas clearance at deep discount over the years)so the only cost will be stamps.
$400 *Shopping for and exchanging gifts with family----
By far the largest outlay of cash goes on in this category! Most of this amount if earmarked for our 3 teens. It's true, the older your kids get the more expensive their toys. We average $150-$200 per kid for gifts.
Now before someone has a coronary over this amount, let me say that we do NOT buy stuff for our kids year round. They receive a nice birthday gift(at their ages, that's usually cash now)and gifts at Christmas. That's it. They receive an allowance until they get their 1st job and are expected to take care of their "needs" as well as save some with those funds. There are unexpected/spontaneous surprise gifts during the year but not very often.
You'll notice that if I spend $150-$200 on each child with this gift budget I will have gone over my limit.
I have brought down the actual cash I'll be spending by using other sources of 'cash' to buy some of their gifts.
We have a credit card(which we pay off each month)that gives us points that we can redeem for a variety of "stuff"......from electronics, to housewares, to magazine subscriptions. We can also buy services, green points, pay down debts, make charity donations or get gift cards. I've redeemed some points already for gift cards for the teens. I also have been socking away giveaway winnings(gift cards and amazon dotcom account codes for cash in my account, etc.)and turning in SwagBucks points. Between all this it gave me about $200 toward my gift budget.
The rest of the gifting budget that doesn't get spent on the teens, is for buying the nephew a present and for Hubs and I to get each other something modest. Being old fogeys we really don't need much....a book, new slippers, a new can opener, that sort of thing. Yes, we live on the edge....
Our immediate family does a Secret Santa. Instead of each of us buying 4 gifts, we draw names and we get 1 person in our family a gift in the $20-$30 range. Each person uses their own personal money for the gift they buy so this Gift Budget does not cover that expense.
We don't have a large extended family and there is only 1 other child. I don't believe in adults just exchanging gifts by rote because everyone else does it or that's what your family has always done since you were a kid. This leads to a lot of people spending money on useless stuff that the recipient usually couldn't care less about or have a use for it. I've gotten my fair share of cheese logs over the years and I am so glad that's over! Nothing says love at the holidays like a cheese log.....yah, right. I also don't believe in buying presents for adult family members that you won't physically see at Christmas. Having to ship presents can get very costly! If you live 4 states away, you'll get a card and maybe a phone call. If I really like you, maybe a tin of cookies.... ;-)
You will note that I didn't mention paying for wrapping any gifts. I have a large supply of wrapping paper, bows, tags, tape, bags, boxes, etc. so nothing needs to be bought. I also have many Christmas fabric prints and once the paper is gone, I'll be making up some
Furoshiki cloths with them to use in the future.
$30 *Cooking Christmas dinner----
Most of the food is already covered by my monthly food budget so this amount is if we want anything 'special' to eat. One year we bought a Smithfield Ham(not very cheap or easy to find up north here!), one year we got a Leg of Lamb(also not cheap or something we eat on a reg. basis). If we get a cheaper protein like turkey or reg. ham, we'll use the leftover for champagne or egg nog or sparkling cider, etc.
$100 *Charity----While we do make monetary charitable contributions throughout the year, I like to also make one during the Holidays. We give here and there during the year plus give on a biweekly schedule through payroll deductions to a charity that we've supported since the mid 1980's. I like to get the kids involved at Christmas and they sometimes help me decide where to direct this donation. Food bank, or Toys for Tots or Salvation Army Angel Tree gifts or buying gifts for a family in need from a private Yahoo Group I have been on for years are some of the past choices. I also donate food and/or HBA locally and expect my kids to lend a hand with whatever we do. And they have been included in the past in packing Samaritan's Purse Xmas Boxes, gift wrapping for the local toy give-out, picking out the Angel Tree gifts we gave, or taking part in Holidays food drives. The Holidays can so easily become "what's in it for me" to a kid. It's always a good thing if you can include your children in some kind of charity work or any activity where they can "give back" to their community and maybe realize that the Universe does NOT revolve around them and teach them that many other kids have it far worse than they do.
$20 *Baking cookies and pies----
We try to take one night and do some baking together. Some years we succeed, some years not so much. Participation varies depending on which kid(s) are "into it" that year or if Hubs can drag his butt out of the lazy boy. ;-) Hubs and I began this cookie/baking tradition on Xmas eve, as a young married couple before the kids. Now we try to fit it in during the Holidays but usually don't wait until Xmas eve anymore. Since everyone here has a different favorite pie, I will make 3 or more different kinds of pies for Christmas dinner. Much of the basic baking supplies are already here and covered in the monthly food budget so the $20 is for special ingredients, like pecans, coconut, etc.
$5 *Christmas Tree----
We have 2 artificial trees and boxes and boxes of ornaments and decorations so we don't need to spend anything to deck our halls. I also have many Holiday music cds since I love listening to Holiday music! The only money we may spend in this category is on the additional electricity if we put lights on the tree or string some outdoors lights on the house. We don't go all out with the outdoor electrification but we have been known to string some lights on the front porch.
$125 *A Christmas eve meal and show or movie----
We started a tradition in our family a few years back when the kids got older and could be counted on to behave(mostly!lol)in a restaurant. We spend Christmas Eve dining at a small local Chinese/Japanese Restaurant. It's a small town so the staff knows us as we dine there frequently, so there are very welcoming to us. And the food is very good and reasonably priced. And we are supporting a small local business which is always a good thing. ;-)
So we host a family dinner there and whoever is in town is invited to go Christmas eve. Picking up the check is our gift to the adult family members who attend, since we don't buy gifts for any but the kids in the extended family. This amount also includes generous tips for all the waitstaff.
Often, we will rent a movie and go back to the house for cookies and coffee and the show. Not having to cook and clean and do dishes for this dinner the night before hosting Christmas dinner is priceless to me! ;-)
This Spending Plan leaves me approx. $10 of wiggle room. Many of my budget categories fall under variable spending, meaning I can actually spend less on some items if I need to(cheaper gifts, order less expensive foods at Xmas eve dinner, bake/cook less expensive dishes for Xmas dinner, pack sandwiches/fruits/drinks for the meals while traveling, give less to charity, no special drinks for dinner, etc.) I don't worry about leaving such a small cushion since I have discretion in how much I spend in a lot of categories.
Of course, as we go along and if plans change, the spending allocation will adjust. But I will be tracking my spending, keeping my receipts and we'll see how it all turns out in the end.
So how are you funding your Holiday spending? Do you have any good ideas to raise some additional money for Christmas? Or will you start 2011 with a Debt Hangover?
Does your spouse or significant other share your vision for Holiday spending? If not, how do you reconcile your differences in approaching your Holiday spending?
Sluggy
