This year marked our fourth Christmas being debt free with no credit cards!  I cannot believe it has been that long.  The sense of freedom when debts are gone doesn’t go away or lessen over time.  When we started following the teachings of Dave Ramsey’s Total Money Makeover and Financial Peace University in 2009 we had NO idea how much our lives would change for the better.  You can read more about our financial story here if you’re interested.  This past year we transitioned to one income.  Funny story: I actually called in to Dave Ramsey’s radio show to ask if we were okay financially to quit my job and become a stay at home mom in a few months and he told me to do it that day.  I waited six more months, but it was so great having the advice our one of our financial heroes.  Christmas is a tricky time for money and frugality.  We all want to make it special for ourselves, our kids, our friends, our loved ones, and even our pets.  It is totally possible to be frugal and still have a fabulous gift giving, charity helping, generous, festive Christmas.  I promise.  We’ve done it for the last four years and we get better at it every year.  
To start you off I’ll share five easy ways you can start NOW to have a frugal Christmas next year.  
1)  BUDGET!!!  Yes, I mean it.  Plan now for how much you want to spend on everything from decorations to Santa gifts to cookies for your child’s classroom.  Christmas will be here on December 25, 2013, just like always and as Dave says, it is not an emergency.  If you set your budget and start putting a little bit aside in your gift or Christmas fund in January, you won’t be strapped for funds and it will make it easier to save on other things.  Don’t know where to start? Write down how much you spent this year on everything.  If you will be paying it off for months you know you will have to reduce.  I’ll share our Christmas budget as an example.
Cards: $20 
Stamps: $25 
Gifts to each other: $200 ($100 each) 
Gifts for Bear: $50  
Gifts for Family: $160  (We draw names but still buy a little something for our parents and nieces/nephews.)
Decorations: $20
Total: $475
That total may seem super low to some of you and super high to others.  Jed polled his 9th grade students and they guessed overall that we would budget to spend $500 each on each other and about the same on Bear.  Let’s just say they are a little bit confused about how much their teachers get paid.  Our budget will go up next year with our new addition, so we will probably budget $50 per month over the year.  If you like to do holiday specific charitable giving, plan for that as well.  We give monthly to our churches and causes, so we don’t do a big year end gift.  Most folks do get a lot of charity asks in December though, so it might be wise to set aside a bit to cover the unexpected.
2) BUY ON SALE AND HIDE  I start looking for Christmas stuff at after Thanksgiving sales, the year before.  Then I strategically hide everything.  All of the Bear’s presents were purchased at consignment sales, thrift stores, garage sales, discount stores like Ross and Marshall’s, or were at least 50% off at retail stores.  They all looked new and he loved them.  The wooden activity block came from a Rhea Lana consignment sale and cost $12.  They retail from $75 to $150.  I bought it in October of 2011 and saved it for this year.  Your toddler will never know that you got that doll off Ebay, I promise.  We have all fallen prey to the “my baby deserves the best” ploy so many times.  Your baby deserves a stable home with no money problems.  This premise applies to other categories as well.  Decorations are on clearance everywhere right now.  Buy Forever stamps for next year and set them aside.  They will only go up in price.   
3) LOOK FOR DEALS AND THINK AHEAD  If you like to send out photo cards, take a cute family picture in  August and have it ready.  Sign up for emails from printing sites like Shutterfly, Tiny Prints, Minted, and Snapfish.  Companies start sending out emails offering 10 free cards in September this year.  I sent out about 50 cards and paid around $12 total using deal emails like those.  I ordered from several different sites and only paid shipping.  On other things always shop around.  Always, always, always check Amazon.  Download the app and do it in the store.  Target now price matches year round, which rocks.  
4) USE CASH MONEY, HONEY  Studies show that your brain actually reacts differently when you use cash as opposed to cards.  You feel it more and it triggers pain receptors.  This is a GOOD thing.  Remember that money you budgeted each month in #1?  Take it out of the bank and put it in an envelope marked “gifts” and use that to make your purchases.  If you find a deal online, write that amount on the envelope and put amount of cash back in the bank.  Using cash is hard, but it is worth it.  By the end of the holidays next year you will know exactly how much you spent and will have paid $0 in interest on your cards.  Winning.  You can read more about how we use a cash system year round here.  
5)  MAKE MEMORIES, NOT MONEY MISTAKES  If you think back on all your holiday gifts and experiences, you will probably be hard pressed to remember more than a few gifts.  What I remember most are the experiences: cooking together, driving around to see lights, decorating the tree, caroling (or kazooing – I had a really fun youth pastor),  volunteering, Christmas Eve services, etc.  Think about what makes your holiday special to you.  Ask your spouse or siblings what matters to them.  Most people probably won’t say the gifts.  Draw names and set a price limit with your adult siblings, their spouses, and parents to take down the stress level for everyone.  We do a $50 limit with my family.  Buying one thoughtful gift for a family member is sooo much nicer and less stressful than buying 18 crap gifts for the whole bunch.  Give priceless but cost free gifts to friends and family like a night of free babysitting or offer to take their family photo.  Use your natural talents to make special presents for your loved ones.   Our consumer culture has turned Christmas into a competition, instead of celebration of God’s love for us and our love for each other.  Let’s take it back. 
How do you save money during the holidays?
Do you plan ahead?  
Send me your favorite frugal holiday tips by email or blog post comment and I’ll link to you in an upcoming post.  

4 Comments on Frugal Christmas: Five Easy Ways to Save Money Next Year

  1. I start buying stuff when all the good stuff goes on sale after Christmas and I am usually done after Black Friday when I buy gifts for my husband. It saves us so much money and I keep a spreadsheet so I can keep track of what I have for who.

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