Updated November 28, 2022

The holidays are a wonderful time of year… but planning for them can be stressful with the looming fear of spending a fortune on gifts and other holiday expenses. If you’re worried about your holiday spending budget and are hoping to not break the bank, rest assured that you’re not alone — but also know that you don’t need to break the bank to make the holidays special.

Here are 10 great holiday spending budget tips for creating a holiday budget to help limit stress, keep spending under control and maximize merriment.

1. Set a Spending Limit

While many of us might create an average holiday spending per person to ensure we don’t go wild with our holiday gift spending, you’ll want to make sure you’re not too vague — otherwise, you’ll end up overspending.

Creating a holiday spending budget with a spending limit is perhaps the most important of many budgeting tips you can use to keep your finances on track. Before you begin shopping, determine what your holiday spending limit will be. You don’t need to factor in what you’ve historically spent, but if you want to get really specific, research holiday spending statistics in your area. You can also look up the cost of the things you know you want to buy for loved ones to get an idea of how much you want to spend.

2. Be Realistic with Your Holiday Budget

Just because one of your siblings, parents, or friends always gives the fanciest presents in no way means you need to max out your budget in return. The holidays aren’t a competition and you’ll only add to unnecessary stress if you view them that way. Determine a realistic budget based off your spending limit for gifts, treats, and holiday events. Whether your limit is $50 or $5000, choose something that works for you and stick with it.

3. Ask for Wish Lists Early

If you wait until the last minute to complete your shopping, you’ll risk missing Black Friday deals and may have to spend more money in a short amount of time.

On the other hand, if you start buying gifts in November, you’ll spread those expenses out over two months versus just one. Ask for wish lists early and don’t procrastinate on shopping. This way you’ll have time to search for deals, eliminate the stress of last-minute shopping, and make sure you can budget everything out in time.

4. Take Advantage of Cyber Monday and Other Sales

With your spending limit, budget, and wish lists in order, you can take advantage of all the pre-Christmas holiday sales. Cyber Monday is one of the best! If the Black Friday lines aren’t for you, you may want to focus on Cyber Monday and other online bargains, so you don’t even need to leave the comfort of your home.

5. Use Discount Tools

There are discount codes, tools, and apps you can use when making certain online purchases to save money. Honey is one of the easiest online discount options. Signing up is free and it automatically searches for deals, sales, and discount codes available to you. Plus, if you’re an avid podcast listener, chances are your favorite podcaster has a discount code you can use. If you’re looking for ways to save on your holiday spending budget, don’t shy away from discounts.

6. Set Aside Portions of Each Paycheck for a Holiday Fund

Holiday expenses can be a  huge hit to your finances — even more so if you’re unprepared. To make it easier and less like a sucker punch to your bank account, try putting portions of every paycheck aside in the weeks or months before the holidays. This will help create a sizable holiday fund and make it less of a shock when you start spending money on holiday expenses.

7. Track Your Spending

There’s virtually no point in setting a spending limit or creating a holiday spending budget if you don’t keep to it. Track your holiday spending to ensure you keep to your budget. You can do this easily with budgeting apps or simply use an excel sheet if you prefer. There’s an abundance of budgeting and saving apps available for military families that can be a great help during your holiday shopping.

8. Gift Your Time

Many people don’t need or want expensive gifts or even material items at all. Many of your friends and loved ones would rather have the gift of your time.

Consider visiting your family for a weekend, giving out “free night of babysitting” certificates, or offering to cook a meal or a dessert for someone who needs it. You may have some special skills or talents that could be more meaningful as a pro bono present than any new physical present. Not every gift has to come with a price tag attached.

9. Pay with Cash

One of the best budgeting tips to keep yourself from racking up a bunch of holiday debt this year is to pay with cash when. Don’t apply for extra credit cards or max out the cards you currently have. Driving up credit cards will only make it more difficult on the other side of the holidays and add stress to the new year. Pay with cash so you can see what money you’re spending and avoid overspending.

10. Focus on the True Meaning of the Holidays

This might sound cliché, but it’s way too easy to get swept away by the consumer-focused aspects of the holidays and forget what the season is really about. Do your best to focus on what’s important: friends, family, making good memories, and enjoying the holidays. Gifts are only a small part of what makes the season special.

Don’t let holiday spending steal the joy from the season. With a solid plan, you can create an effective holiday budget and stick to it this gift-giving season. If you’re open to alternative gift ideas, invest in your loved ones with time, memories, and experiences.

More Ways to Save Over the Holidays:

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