10 Steps to a Debt-Free Holiday
My husband and I are committed to living debt free. For us, this means that even during the Christmas season, we don’t use credit cards or loans to purchase anything. Not even for the reward points that some companies offer on lines of credit. Still, we’re able to provide a nice, debt-free holiday for our family.
So, how can you enjoy the holidays and remain debt free?
1. Commit to being debt free.
Honestly, that’s the first and most important step. If you go into it half-heartedly, when something unexpectedly pops up, as it always does, you’ll be overcome with the temptation to say, “charge it.” Especially, if you and your spouse haven’t already made a commitment to paying for everything up front, in cash.
2. Plan ahead.
We save money year round, s when it’s time to start shopping for gifts, we budget the money we’ve already set aside in our account specifically for that purpose. However, if Christmas is upon you, and you haven’t put money back for it, it’s still not too late!
3. Make two lists.
On the first list, jot down the people to buy gifts for. On the second list, write down all of the other expenses, such as food for get-togethers, holiday décor, and any other holiday-related expenses.
4. Go through the list and determine the total amount of money to be spent on each person and item.
Our budget comes from the total amount of money we have available to make purchases, not what we want to spend, feel we should spend, or wish we could spend. Once we determine exactly how much we have on hand (or in our bank account) to spend, we then allot that specific number of dollars to our food budget for Thanksgiving and Christmas meals as well as, any holiday parties we may be hosting. We go through the gift-buying list and determine how much we can realistically spend per person.
5. Don’t forget to include the incidentals.
Remember to factor in gifts for teachers, unit coffee Christmas parties, unexpected Secret Santa gifts, etc. Even the small things add up. When you aren’t prepared and they do pop up, it’s difficult to not fall back into the old habit of placing it on credit.
6. Weed out unnecessary items.
If your budget is overstretched, begin removing things that aren’t really necessary or that important. Perhaps you don’t need to buy a gift for every single person on your list or be the host of an elaborate holiday gathering. What can you strike off the list? Perhaps the office staff would be willing to draw names for gift exchanges, instead of everyone buying a gift for each individual. Or, consider consolidating by purchasing a gift for an entire family rather than each individual family member. Consider your options and pare down. None of us want to be seen as Ebenezer Scrooge; however, it has been my experience that many people feel the financial pinch of the holidays themselves and will completely understand.
7. Buy used or on sale.
You can find unique treasures or hard to find items and still in great shape, all while saving your hard earned dollars.
8. Consider homemade gifts.
This can be a great way to give a meaningful gift and keep more money in your wallet.
9. Volunteer in the name of your gift recipient for a charity that is especially meaningful to him or her.
For example, if your sister is a breast cancer survivor, consider volunteering for the American Cancer Society or other similar non-profit organization for a couple of hours. Be sure to call the organization and let them know your intentions, setting it up ahead of time. This is also a great way to teach your children the importance of volunteering and giving back to others less fortunate than themselves. At the holiday gift exchange, in lieu of a store-bought gift, give a card to the person, in whose honor you volunteered, explaining what you did.
10. Finally, stick to your budget.
This, at least for me, is the hardest part. Especially when my children watch ads on TV, exclaiming, “Mom, that is awesome! I need that!” With all the commercialism of the season, it’s so tempting to stray from the budget. Be firm—with your family and with yourself. When your children look back on Christmases past, they won’t likely remember the high dollar gadgets you bought for them, rather they will fondly remember the time you spent with them baking cookies, decorating the tree, and sipping hot cocoa by the fire. Those times are the things worth remembering, and you can’t buy that with all the money in the world—not even with a credit card.
Share your tips for saving money during the holiday season!
