The best way of budgeting for Christmas

How much does Christmas cost?

The chances are, all you can remember is that last year, your family Christmas cost a lot.  You probably put a figure on it, guessing roughly – but hoping that it was nowhere near that amount. Here’s a really easy way to stay in control of your spending…

What are all the Christmas expenses?

Obviously presents is a significant part of Christmas spending, but then also comes : food, drink, decorations, more food (even the small condiments which don’t seem that significant, but probably cost far more than you thought), cards, postage, spare bedding, candles, travel, Christmas parties, nights out, seeing Santa, late night shopping visits, school plays, emergency chairs, new clothes (especially Christmas Jumpers) – the list goes on and on.

What’s the best way to keep a track of all this?

There is a really simple way of how to keep on top of the spending this year – use a credit card for all your Christmas spending – everything.

Doesn’t a credit card cost interest and charges?

Not if you repay it each month.

So how does this one card for Christmas work?

  1. Put all of your Christmas spending on to the one credit card
  2. Repay the bill in full each month
  3. After your January bill, total up everything that you spent on Christmas (simply add up all the totals on your monthly bills)
  4. Take that amount and divide it by 10 or 12 – and that is how much you need to save each month for next Christmas
  5. Put that amount into a separate savings account every month
  6. Start tracking again next year

The reason what 10 months works best, is because by the time you get your January statement, one month has already passed, and of course, you can write of December, because by then, the spending will be in full through (it’s also easier to quickly divide the total cost by 10).

Good tidings of Comfort and Joy

There’s no guarantee that this approach will remove all the stresses of Christmas – certainly you will face all the usual challenges – but at least now, you will have a handle on you finances throughout the festive period, meaning that you won’t come across an unexpected financial problem midway through the spring (just like you always find that one Christmas decoration lurking somewhere).

When should you start budgeting for Christmas

This depends on how organised you are.  Autumn usually seems to be when most people start turning their thoughts to Christmas, however, if you dedicate that one card to ONLY Christmas spending, it doesn’t matter.  I would suggest putting the plan into place, then you are ready to make life easier for yourself.

See the video here 

In January, I’d love to hear in the comments section of how you have got on, or if you have any top tips of your own for budgeting for Christmas.

Together we can bring some Serenity to your life

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