Spending money at Christmas is basically required, but you can be smart about it and save yourself headaches in the new year.
Many gifts were bought this past weekend, either on Black Friday or Cyber Monday. A lot of money was also spent and often, we don't even realize how much we are spending.
Brian Denysuik from CreditAid says that going into Christmas blind is one of the worst things to do, regardless of how much you typically spend during the holidays.
"It doesn't matter what you're spending," Denysuik said. "I always encourage people to go into this time of [the year] with a budget."
Denysuik offers a few tips for getting started:
- Start your budget January 1 - on January 1, 2018, Denysuik recommends taking a look at Christmas 2017 and figuring how much you spent. If you need to adjust it, that's OK. Divide that number by 12 and start saving every single month.
- Make a list of who you are buying for and how much you're going to spend - after you have your budget, go through the people on your shopping list, whether they are kids, spouses, parents or friends. Put a dollar amount beside their name so that they add up to your proposed budget
- Make a list of items to buy for each person - once you've made the list, add the items you would want to buy for that person. When you are purchased the item, cross it off the list. When your purchases equal the dollar amount you set, stop purchasing items for that person.
Christmas is, of course, the season of giving, so Denysuik understand's that it can be hard to not buy stuff, especially when others are spending on you. But he says giving doesn't have to be monetary.
"Giving could mean giving of ourselves [or] making gifts," Denysuik suggested.
For Denysuik, he holds 'Make It or Bake It' gatherings where every gift has to fall into that category. If he is purchasing gifts, he often gets gift cards with a smaller amount on them but chosen for that person. Things like car washes or movie cards are examples that he gave.
The biggest issue you can have at Christmas is putting things on your credit card that you cannot pay off.
"If we are running credit card balances [and paying interest], everything is going to cost one and a half times at least," Denysuik warned.
His suggestion is to keep a budget every year and enjoy time with friends and families this Christmas season.