Don’t let Christmas derail your budget

Don’t let Christmas derail your budget

Avoid a Christmas splurge with our five festive financial fixes.

You’ve worked hard all year to keep your finances on track. You have savings in the bank, you’re on track with your personal loan repayments and have a strict budget to pay for Christmas. Don’t let it all go out the window over the festive season in a moment of weakness. 

Here are our tips for avoiding the dreaded Christmas blowout.

1. Plan and track 

Do this bit and everything else about paying for Christmas should be easier. Audit your finances and figure out how much you have to spend. That includes having a clear picture of what kind of financial position you want to be in once the decorations are all packed away for another year. If it helps, write it down and keep it somewhere you can see it, to help keep you on track and off the credit cards.

Write lists for every aspect of your Christmas, not just the pressies. Remember to include food costs and travel costs as well as things like pet care if you’re going away, and even extra power or water costs if you’re going to have a house full of people for several days. Once you know what you’re getting, where you’re getting it from and what you’ll pay, think about using cash to pay.


2. Bargain hunt

Once you have your shopping lists sorted, keep an eye out for bargains, and shop around for the best deals. Some foods can be bought in advance when they’re at a good price and frozen until you need them. And there’s plenty of retailers who’ll be having pre-Christmas sales so keep your eyes peeled. 

If you’re buying online, don’t forget to factor in shipping costs. Some sites will offer free shipping on a minimum amount, so see if there’s more than one item you need - or see if you can combine your shopping with someone else’s and split the shipping cost.

3. Have a pre-Christmas tidy up

Do you have loads of stuff lying around your house or garage that you’ve been meaning to get rid of? A pre-Christmas tidy-up might be the answer, giving you the combined benefit of a tidy house for hosting guests, and maybe making a bit of cash on the side from items you could sell. Books, toys, clothes, furniture, sporting equipment - things you no longer need may make you a few extra dollars in a garage sale or by selling online.

You may also find perfectly good pressies you’ve been given in the past, but never used that are ripe for re-gifting. It’s traditionally been a bit of a dirty word, but if you own something you know someone else would like… why not? Just be a bit sensitive to the feelings of the person who bought it for you in the first place!

The lead-up to Christmas is also a good time to tidy up your finances. You might find you can pause payments on things like streaming services, the gym or other subscriptions you’re not using to free up some extra money.

4. Manage expectations

If your budget only allows for a fairly lean Christmas, remember that’s perfectly fine! Your friends and family don’t want you to be under financial stress for the sake of buying them that gift. 

Be as honest and open as you feel comfortable with and just let people know you’re keeping an eye on your spending, and want to keep Christmas on a small scale. Suggesting a pot-luck Christmas dinner can be a good way to keep things under control for everybody, so everyone can just cater for what they can afford. 

They’ll understand; they may even be a little relieved!

How you manage your kids’ expectations will probably depend on how old they are, and what they understand about money. Older kids are potentially a little more susceptible to present peer pressure and what they “must” have, but you should also be able to have a fairly honest conversation with them about wanting to keep costs down. 

You may even be able to use it as an opportunity to teach them a little about budgeting. 

Younger kids are probably easier to please on the pressie front. Make them the centre of your decisions and turns things into a game or adventure wherever you can.

It doesn’t need to mean being a Christmas Scrooge. There are plenty of ways a cheaper Christmas can be a fun Christmas, whether it’s choosing to bake or craft gifts, or designing your own decorations. Which brings us to:

5. Be creative.

It can be some of the Christmas extras that tip your spending past your budget, but they’re also some of the easiest things to create yourself. Wrapping paper and labels, table and tree decorations, stockings, crackers and even party hats are all fun ways to keep your costs down and involve everybody in Christmas. 

You can also be creative with your gift giving, beyond just making your own gifts. Agree with everybody in your Christmas group about how much you’ll spend on presents and how they’ll be distributed. It could be a lucky dip, a secret Santa, deciding on a strict spending limit, or gift each other services such as an afternoon of gardening, or an evening of babysitting. If everybody knows the rules up-front there’s less cause for disappointment or awkwardness.


The last word: Don’t beat yourself up if you have overdone it this Christmas. If you’ve maxed out the credit cards, you may find debt consolidation a useful option that could help you save money on interest payments and will give you a fixed timetable in which pay the debt back.

If you need extra help to get yourself back on track, or you know someone who’s experiencing financial distress, seek out free budget advice from MoneyTalks or search for "debt advice" in the Family Services Directory. www.nowwearetalking.org also has some great resources and advice for starting that difficult conversation.

Other articles you may like:

Spread the cost of Christmas

Learning to love your budget

Is social media blowing your budget?

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