Do You Want A Debt Free Christmas This Year?
You might want to run away and hide from the thought of Christmas in 12 months’ time; however, if you start thinking now how you intend to pay for the festivities then you have the time to save the money you will need and it will be a debt free Christmas!
The more you are able to put away in small amounts the less stress you will have when it comes to buying presents for all your friends and family because you put money away from the beginning of the year.
The more you are able to put away in small amounts the less stress you will have when it comes to buying presents for all your friends and family because you put money away from the beginning of the year.
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A Debt Free Christmas is possible!
I don’t have any debt for the Christmas just gone and I don’t intend on having any debt in 12 months’ time because I have already started saving for the festivities.
Why I start early is simple, it means I don’t have to take as big a chunk out of my monthly budget. If I started later in the year, I would notice the bigger chunk of money from my budget and it might mean not having the same amount saved.
It does mean there is a limit to the presents that I can afford to buy; there is not a bottomless pit or a credit card supplying me a steady stream of credit to buy endless items that I just can’t afford.
This is something that I have stated for years and family know not to expect elaborate gifts as they are just not in the budget. Yes, if there was more money in the pot, then I would love to buy my family more, but then you start treading on the point of how much you should spend and I just don’t want to go there!
How Much To Save For A Debt Free Christmas
This will depend on your circumstances, how much money you can afford and what you need to spend during the Christmas period. This is different for everyone and that is OK.
The good thing is that once you have an amount, saving the money is the same; you have to put it in a safe place, one that you can’t touch, not even for an emergency because if you use this money you are in effect spending the only hope for a debt free Christmas.
To work out how much you need, look at the Christmas just gone and work out how much you spent on presents, food and other holiday essentials that you purchased. Use this information to break down into categories and see if these amounts are what you intend to spend this year.
Divide this number by the number of months left in the year, if you deal with weekly budgets rather than monthly just divide by the number of weeks left before the start of the holiday season rather than months.
If You Can’t Afford The Payments
If this figure is higher than you can afford you have to look at your budget, is there anywhere you can adjust the spending? If you can’t then you need to adjust your Christmas budget to a point where it is affordable over the course of the year.
If you can’t afford the figure that you come up with, then you need to cut back your holiday budget or find more wiggle room in your budget.
Without a budget, you can’t plan your financial future, even your short-term financial goals will be difficult to predict, let alone add-in another expense.
If you need to adjust down your Christmas budget, look at the different categories where you spend your money. If you are able to cut back in more than one area, like presents and food, you might reduce your monthly saving considerably.
Creating and sticking to a budget isn’t always easy if you want more information, this book by Dave Ramsey is really good.
Where Can You Get Extra Money
If you are looking to find extra money for different areas of your Christmas budget, you have a few options.
- You could consider getting extra work; you might be able to get a second job with the aim of putting the extra income directly into your Christmas savings. This is a great way to bump up your savings, but it does take hard work not to spend this money in other areas before Christmas.
- Reduce your current spending in those movable categories like groceries, entertainment and any other luxury category that you have in your budget, trying to reduce the spending can help to increase the amount in your Christmas fund. However, this is difficult to sustain over long periods, so this isn’t always a long-term option unless you know you are very dedicated to saving money.
- Selling items that you and your family no longer need is a great way to add to any holiday fund. Don’t buy items just to sell, this is starting a business and unless you’re registered you can end up in trouble for selling this way.
Your budget is key to building your financial success over the coming year, the more in control of your budget the easier it is to make the right decisions as to how much you can afford. If you want a debt free Christmas it is important that you act now, don’t leave it another week or month, this will increase the monthly payments that you need to make and can make the whole process more difficult than it needs.
Therefore, if you are looking to have a debt free Christmas you must act now and start saving, use your budget and last year’s receipts to work out how much you need to save. If you can try cutting small amounts off those areas in your budget that are movable, like the take-out coffee or the chocolate bar, this can add up over the course of the year to more than you can imagine. It is possible to have a debt free Christmas but you must start working towards your goals now!
