The holidays are fast approaching, and you may find yourself looking at your bank account with some distress. It can be easy to overspend during these festive occasions, and because of that, it is important to create a holiday budget – and stick to it. In this article we will show you how to do just that!
Steps to Create a Holiday Budget
If you already have a monthly household budget in place, creating a spending plan for the holiday season should not be that difficult for you – think of it as a smaller version of your monthly plan.
If you do not have a monthly budget created yet, we greatly encourage you to create one. Think of a budget like a roadmap and financial security as your final destination. If you do not have a set of directions (and, more importantly, if you do not follow them), how can ever expect to land at your end-point?
The first step you should take is to ask yourself this question: how much money do I realistically have to spend? Once you have this number in mind, you can begin to make a spending plan, which should include how much you intend to spend on each family member and friend. Once you decide on these two key factors, stick with your decision and don’t make any modifications.
Another thing to consider when creating a holiday budget is how much you will spend on the celebrations themselves, as well as incidentals. For example, you may have allocated $50 per gift for everyone in your family. However, does that include the cost of wrapping paper, bows, ribbon, or tape? How about shipping fees? All of these “holiday incidentals” need to be figured into your budget as well.
If you are hosting for the holidays, you will need to add this to your budget too. Figure out a “price per plate” that includes food, drink, plastic ware and paper plates, and so forth. If you want to cut down on this cost, consider asking loved ones to bring something, such as a bottle of wine, a casserole, or dessert. This is a pretty common practice, and if each person brings a side dish or appetizer, it not only helps reduce your costs, but it makes your guests feel as though they are a bigger part of the occasion. Who doesn’t like to share a favorite recipe after all?
Another thing you should do is create a spreadsheet to keep track of all of your expenses and gift purchases. If you know what you intend to purchase for each person, mark it down on your spreadsheet even if you have not purchased it. This will help you keep track of your purchases and help ensure you do not overspend.
Finally, make up shopping lists for gifts prior to hitting the stores. This not only helps you avoid temptations, but savvy shoppers will go online and bargain hunt to find out which stores have the items on their list for the lowest price.