Navigate the holiday season without exceeding your budget.

Created by Camila Mirabal on December 06, 2021

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I love the holidays. It brings me joy to buy gifts for my family and friends. But sometimes, I spend more than what I had budgeted. I refuse to have this happen to me this year. That's why I want to share a few tips that I’m following to buy presents and enjoy the holidays, without going over my budget. 

  1. Make gifts. I do pottery, and for the past months, I’ve been making my friends and family personalized pottery pieces. If you don’t have any hobby where you can make them presents, you can find some ideas here. 
  2. Set a dollar amount limit per gift. There are three ways to handle restrictions: ignore them; complain over them; get creative. If you set a dollar amount limit, you'll probably find the perfect present at the wrong price. Go to a different store, look online, find similar products. I'm sure that if you get creative, you'll find alternatives to the ideal gift within budget. 
  3. Don’t accept all invitations. It’s common to want to be part of all the holiday activities. The office Secret Santa, the tea party at your college friend’s house, etc. Attend the events you really want to and learn to say no to the ones you’re going just to be nice. 
  4. Make a zero-based budget. 

What’s a zero-based budget?

It’s simple. It means your income minus your expenses equals zero. So “if you earn $3,000 a month, you want every dollar you spend, save, give or invest to add up to $3,000 too. That way you know where every one of your hard-earned dollars is going.” Explains Ramsey Solutions. 

How to make a zero-based budget for the holidays?

Step #1: Start by writing down your monthly income. That means all the money you receive each month. This could be paychecks, side-hustle income, bonuses, alimony, etc. If you’re getting anything extra for the holiday season, add it up as well. 

Step #2: Do the same with your expenses. Be extremely thorough with your holiday expenses. List everything you usually spend money on and all the estimated spendings. Don’t forget to add food costs, utilities, shelter, and transportation. Once you’ve covered the basics, move on to the rest. 

The holidays have more expenses attained to it than just gifts. You’ll probably need to add gatherings, food for when you have people over, gift wrap, and decorations. 

Step #3: Make a simple math operation. Sum all of your income, sum all of your expenses and then subtract your expenses from your income to equal zero. If you have money left, add it to a bucket, probably savings. If you get a negative balance, adjust your variable expenses until you get a “0” as a result of this operation. 

Step #4: Stick to it. This is the hardest part of budgeting, but it’s what’s going to make the difference. The idea is to budget enough money so you’re not constantly overspending, and if you are, then you need to either adjust your priorities when it comes to spending or find ways to make more money. 

The holiday season is a beautiful time to spend with your loved ones, prepare in advance to avoid having money be an issue. 

Happy holidays!