steps to avoid overspending on Christmas Gifts

It’s so easy to go overboard buying Christmas gifts. After all, we want to celebrate the people we love. Moreover, many of us don’t see our family and friends a lot throughout the year. Therefore getting together at the holidays is a great excuse to truly celebrate. However, you don’t have to spend a lot of money on gifts to have a good Christmas. In fact, spending less and focusing on quality time usually makes everyone happier in the long run. Nevertheless, it’s tempting to get wrapped up in the joy of it all and make those purchases. In order to avoid post-Christmas spending regret, here are ten steps to avoid overspending on Christmas Gifts.

1. Rework Your Budget Today

By the end of the year, our budget sometimes gets away from us. We make excuses for spending more during the holiday season. Then we figure that we’ll make up for it in the new year. However, that’s backwards thinking. Instead, think ahead and rework your budget right now.

Figure out what your income is each week through the end of the year. Factor in any additional funds you expect to come your way, such as Christmas bonuses. Then look realistically at your budget. How much do you have to spend on rent, utilities, etc? After that, how much is left? Are there any areas of spending where you can cut back in order to have more gift money? 

If you can make your gift spending budget work on paper, then you’ve succeeded with the most important of all steps to avoid overspending on Christmas Gifts. After all, you’ve shown yourself the money you have to spend. As long as you stick within that, you won’t go over budget. Therefore, you won’t go into debt for holiday spending.

2. Make a List and Check It Twice

Make a list of every single person that you would love to give Christmas gifts to this year. Then go through that last with a fine tooth comb. Prioritize the list so that the people you really want to focus on are at the top. For example, if you have children, then you would likely put them at the top of the list. After all, it’s more important to give your young kids a Christmas present than to give one to your coworker who happens to be hosting a Christmas party.

First, prioritize. Then look at the people at the bottom of the list. Can you cross any of them off as not needing gifts from you after all? Once you’ve crossed people off, go through your budget. Allocate specific amounts to each individual. Make the budget work on paper. Keep modifying your list until it does. This takes a little bit of time. However, it’s well worth the effort because it saves you money.

3. Budget for Experiences, Not Gifts

In many instances, you can skip the gifts altogether. The point of the holiday season is truly to spend time together if you can. Therefore, you might want to replace gifts with experiences. Those experiences don’t have to be expensive either. Each year I host a gingerbread house making party. Everyone brings their own supplies. Therefore, I just pay for the basics of the party. As a result, I’m able to gather together with a large group of people, create a memorable holiday experience, and yet spend very little money. This is one of my personal biggest steps to avoid overspending on Christmas Gifts.

Other experiences that you might enjoy with individuals, families, or other groups include:

  • Hosting a movie night at home to view Christmas classics together.
  • Getting together with friends for a special holiday drink.
  • Walking around to look at the Christmas lights together.
  • Attending free local holiday events such as Christmas music performances.
  • Volunteer together. There are so many people in need during the holidays. Focus on what matters.

4. Go The Secret Santa Route

If you have a large group of people to celebrate the holidays with then Secret Santa is the way to go. Each person gets one present. Each person gives one present. Everyone gets to celebrate together and yet nobody spends a lot of money on the gifts.

5. Give Gifts That Save Money for the Recipient

We previously did a roundup of more than two dozen gifts that save money for the recipient. Depending on who the recipient is, these purchases could also save you money in the long run. For example, investing in gift cards, savings accounts, and reusable lunch totes for your kids costs money out of pocket. However, when they use those things, instead of coming to you for more money, you’ve saved too. Moreover, these are often practical gifts that teach your kids the value of money.

6. Use Your Credit Card Rewards Points to Buy Gifts

One of my favorite steps to avoid overspending on Christmas Gifts is to go shopping with my credit card rewards points. I save up all of my points throughout the year. Then come holiday time, I cash them in. I used to use a lot of cards that allowed me to use points to buy gift cards or actual physical gifts. These days I mostly use cash back rewards cards. I take that cash and apply it to my holiday budget. Then I make sure to use the best cash back card to purchase any gifts so I get more money back again. However, if you do have cards that give you points to buy physical things, then by all means purchase gifts with points.

7. Go Through Your Storage For Gifts

People have different opinions on the topic of re-gifting. I, for one, am all for it. If an item is in great condition but I’m not using it, then it doesn’t make sense to keep it. Therefore, re-gifting it to someone who would actually enjoy and use it makes a lot of sense to me. Favorite books, kitchen gadgets I thought I would use but never did, unopened art supplies … these are just a few of the things I’ve re-gifted to people to their delight.

8. Handmade Gifts

There are so many great handmade gift ideas. Small gifts, such as handcrafted keychains, can be a terrific way to gift something to everyone in a group without spending a lot of money. Moreover, if you make gifts together as a family then you can enjoy the experience of the holidays together in that way as well. Just be careful with this one. If you don’t already have the supplies on hand, then the cost of purchasing them can add up. Plan in advance. 

Furthermore, remember that making gifts takes time. For example, I crochet, and I love to give people crochet blankets and scarves. However, I don’t usually focus on doing this at the holidays. It’s simply too much pressure to get things done before the Christmas deadline. Therefore, I usually make those as birthday gifts. With that in mind, though, if you can happily craft before the date, then it’s a great personalized option for saving money on gift costs.

9. Buy More For Needs, Less For Wants

What does your family actually need? What would really benefit your partner in their work or hobbies? Also, what types of items do your kids need (clothing is often a big one)? Sure, you might want to buy one or two frivolous items that are just for desire. However, if you spend the bulk of the budget on buying things that your family actually needs then you end up saving money over time.

10. Opt Out Of Gifting

You don’t have to give gifts for the holidays. Yes, there’s a lot of pressure to do so. However, you’re in charge of your own life. Do you really love holiday gifting? If not, then consider simply opting out. This is a viable option, even when society likes to make it seem like it’s not. If you don’t feel like you can opt out entirely, look for opportunities to opt out a little bit.

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