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Even though the holiday season is still several months away, time will fly by before you know it! The holidays can be stressful with all the family gatherings and commitments, but it doesn’t have to be. We can avoid some of the financial stress of the season by starting to plan earlier and budget better for the holidays.

On average, Canadians spend anywhere from $800 – $1,100 on the holiday season; knowing this should hopefully encourage you to take a look at how you can save and budget better, in order to spend your money differently and avoid going into debt.

1. Begin Shopping Early

The earlier you start your shopping, the more time you will have to do your research and find some great sales, unique gifts, and fantastic bargains. This will help you reduce the pressure of rushing to find the perfect gifts for your loved ones, and the earlier you start the earlier you can finish and pay your credit card off sooner.

2. Have a Gift Budget and Stick to It

There are a lot of things to budget for during the holidays, and the biggest spend of all is the gifts. You can talk with your family members and in-laws and set a budget that you can agree on. Make sure to set a budget that’s affordable and reasonable – that way you avoid going into debt. Use cash as much as possible, and stick to your plan.

Make a list of people and what you plan on buying them, and then set a budget against each name or group of people. Try to beat that budget by looking for bargains and spending less than planned.

Here’s one budgeting template I have found useful. You can use it to budget out your year well in advance.

3. Plan for Homemade Gifts and Gift Exchanges

As we know, gifts can get expensive. You’re buying quite a few gifts for a number of people, and it adds up quickly. Consider giving a combined gift instead of individual gifts.

For example:

  • For kids – video games, board games, play-sets
  • For couples – an experience, weekend getaway
  • For parents – framed family photo, tickets to a show

Another way to give gifts is by making them. If you love to bake, create crafts, cook, and make your own wine, you can save a lot of money by making jams, dried fruit, artsy decorations, baked goods, and homemade wine for the wine lovers in your family. For workplaces, it’s easier to do Secret Santa with a smaller budget.

10 holiday budgeting and saving tips

4. Set a Decoration Budget

With all the holiday flyers, we can sometimes get carried away with how much we spend on shiny new decorations. First off, if you’re buying a Christmas tree every year, look into investing in an artificial tree. They can last for many years, they’re beautiful, and you can also add in that fresh pine scent to make them feel like real pine trees.

Go for LED lights and simple decorations that don’t go out of fashion. Keep your decorations in a safe space and re-use them each year. A simple throw and pillow with some white Christmas lights make for a festive, well-decorated space – and it helps you stay within budget.

5. Limit or Eliminate Holiday Travel

Holidays are the time where everyone wants to be with their loved ones. Plan your celebrations and see if you can cut back on travels during the holidays; instead, plan to visit during spring or summertime.

Since this is a particularly expensive time of the year, try to avoid any travelling if you can – FaceTime with distant family and relatives, email Christmas cards, and save their gifts until the next time you see them.  

6. Plan for Creative Ideas on Holiday Activities

During the holidays, we like to get out and about and spend money, and we forget that the season is about being together and enjoying the season with each, and others less fortunate who don’t have a home, warm clothes or food. Here are some simple yet basic things that are fun for the entire family and truly embody the spirit of the holidays.

  • Painting
  • Arts and crafts
  • Baking
  • Reading a good book
  • Watching a Christmas movie
  • Doing a puzzle
  • Playing a board game
  • Sledding
  • Building a snowman
  • Having a holiday potluck-style open house
  • Volunteering for a charity

7. Pay in cash, not with credit

It’s easy to tap your plastic and pay for it later, especially during the holidays when you’re in the spirit of gift-giving. Once you have your budget in place, take the money out of your bank account and use cash only. One creative way to stretch your money is to buy gift cards and then use the gift cards to make purchases when there is a big sale.

8. Shop by yourself

It’s fun having a shopping partner, but going with a buddy can add to impulse shopping. Also, it’s easier for other people to spend your money. They can encourage you to buy things you otherwise had not planned on purchasing. Shop alone, or even shop online to save money.

9. Wrap more gifts

Everyone loves opening lots of gifts during the holidays. The more gifts, the more fun, right!? Instead of buying more gifts, split up your gifts—so if you have a six-pack of socks, split it up into six different gifts. It makes it more fun for the person receiving the gifts, and it also makes you feel like you’ve bought plenty enough to keep them happy.

10. Start a Plan for Next Year

Christmas happens every year, and since you know that you’ll need to buy gifts again next year, start building your Christmas fun in January, and put aside money each month to cover gifts. Make your gift purchases throughout the year and during end-of-season sales. Keep count of who you have shopped for so you don’t lose track and buy too many gifts.

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Shenaya Sweetman is the Content and Social Media Specialist at Refresh. She’s an avid writer with an interest in real estate, saving and investing for an early retirement. Passions include online health coaching and live fitness instruction. Her favourite finance blogger is Michelle Schroeder-Gardner.


10 Ways to Save and Budget for the Holiday Season