Christmas is almost here! What do I do?

Last Updated on November 23, 2017 8:22 pm by Steven

Christmas is almost here!

Christmas season is upon us again!  It is time for an Emergency? That time of year when we get to sing praises about Christs Birth.  We talk to friends and family we have not seen in a while.  We make excuses to be good to each other.  We decorate our homes, cars, offices, stores, and bodies with reds and whites, and bells, and fake snow (if you live in St George).

We also have the opportunity to “buy… things they can’t afford, with money that they don’t have… to impress people that they don’t like!” – Will Smith

When it comes time to buy Christmas gifts, do you look at your finances and decide that Christmas is an important enough holiday that you will add Christmas gifts to your credit card (and you tell yourself “just this year –  and I’ll pay it down in January”)?

Is Christmas an emergency?  Should you go into debt for one of the biggest holidays of the year?  This holiday celebrates the birth of the Savior of the World! It is a very important holiday!

According to Dave Ramsey – the answer is No!

“..the borrower is servant to the lender.”

Christmas is NOT an Emergency!

Christmas is December 25th this year!

Psst, let me tell you a secret: Christmas is on December 25th this year!  And here’s another one: Christmas will be on December 25th next year also!

Christmas happens on the same day each year – just like clockwork!  🙂

This should not surprise anyone!

Our Fully Funded Christmas Budget

The first year that Lorell and I started down our Personal Finance path we were doing very well.  We got a small emergency fund set up, credit cards were paid off, student loans were being paid down, vehicles were being paid off.  Finances were good.  We were good.

When the first of November rolled around, we realized that Christmas season was upon us.  We had not saved up for Christmas.  What were we going to do?

We had committed to each other that we would only spend any money that was in the budget – we had to have the cash in hand before we spent any of it.  We were determined NOT to break this promise to each other.

That month I had received a bonus that left about $1,000 that would normally budget towards paying down our debt.

With five kids at home and me being the frugal person that I am, we decided that $1,000 is what we needed for Christmas.

So that month, we made a new category in our budget called “Christmas” (I know, very original) and we put the $1,000 cash in it instead of paying down debt.

Christmas Cash

Having cash to pay for Christmas was a great blessing.  We had a certain amount.  It was set.  It was fixed.  We could spend all of it, and none else!

It started a pattern of low-stress Christmas shopping!  No worries about money.  No worries about how long it would take to pay off the Credit Cards.  No worries about the costs of presents.

When January came, we put the decorations away, took the tree down, and discussed how much easier that year was compared to previous years.  There were fewer fights about money.

$83.33 a Month

When it came time to budget in January, our Christmas budget was at $0.00!  Perfect!  We spent all we had budgeted and none else.  That is exactly where it we wanted it!

I pulled out my calculator and did some 3rd-grade math.  $1,000 divided by 12 months = $83.33 per month.   We set a goal to budget in our Christmas Budget Category $83.33 per month that year.   $83.33 did not seem that much.  It was an easy “payment” to make.

Christmas is again on December 25th!

Then, just like magic, Christmas came around on December 25th!  Because we had saved $83.33 per month we had $1,000 in our Christmas budget category.  It helped make our Christmas season a stress free season!  (For all of you Math Majors, we allocated $83.37 the last month so we really did have the full $1,000!)

And the cycle continues…

We have had our Christmas budget category for many years now.  At times the monthly amount went up to $100 per month because we wanted to spend more on Christmas that year.  A couple of years it dropped because we had less income coming in.  All of these ups and downs were planned and considered with the rest of the budget in mind.

Another blessing that saving cash for a Christmas Budget throughout the year brings us is that sometimes Lorell or I will see a something we want to purchase as a Christmas gift in July.  The Christmas budget does not need to be fully funded before we start to spend it.  This creates even less stress as we are purchasing gifts that are more meaningful to us.  These gifts sit in our “secret” hiding place until Christmas rolls around.  When Christmas season comes around there are fewer gifts to purchase.

I just checked our Christmas Budget we have $105.90 that we will be putting into our Christmas Budget Category on our December 1st Budget Meeting.  For all you Math Majors, that number is higher than the $83.37 that we should have put in.  This is because in July our home Air Conditioner broke.  We had to pull money out of our emergency fund to replace it.  Christmas Budget was dropped down until our Emergency fund was fully paid back.  But that is another story for another time….

Do you save up and pay only cash for Christmas?  What blessings do you receive because of the way you budget?

Please leave a comment and let me know.