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One Mom’s Holiday Budget, Dollar by Dollar

Photograph by Twenty20

The holidays are here, which means tons of things on the to-do list—and tons of things to buy. December speeds up fast and always seems to costs way more than we expect.

It seems every family approaches the holidays differently, especially in regard to budgets. While some are sticking with the want/need/wear/read theme, others are planning extravagant holiday getaways. Some are struggling. Some are giving much more than they receive. Some embrace every single sale, while others are overwhelmed with the expense of the season.

Today, I’m going to share an inside look at our family's holiday budget—what we spend on gifts, Santa, extra food, holiday cards and more. It changes some from year to year, but generally, I think we’ve found our Christmas groove in the money department.

The key to making Christmas budgeting less stressful for our family is really quite simple: Instead of expecting the holidays to be extra expensive, we save $100 each month throughout the year. That means that on December 1st, I have $1200 ready to fund each of our holiday categories. If you don’t save for Christmas throughout the year, I highly recommend assessing what you spent this year, dividing it by 12, and saving that amount each month to cover your Christmas expenses next year.

Now, back to our budget this year. To ensure everything is covered, I outline how our $1200 will be spent BEFORE the holidays begin. I’m not perfect, so I won’t follow this to the exact dollar, but my goal is to be very close and not go over.

Ready for a peek at our holiday budget? Here’s the breakdown:

Gifts: $165

My husband and I choose one gift for each of our four children. They truly want for nothing and we tend to do extra for birthdays, so they’ve come to expect less at Christmas. At their current ages (1, 3, 6 and 8), the dollar amount we spend doesn’t matter as much so we aim more to fulfill a special wish or something we know they’ll love. In addition to these gifts, we’re making presents for three teachers. Our extended families no longer exchange gifts, which greatly helps this category.

It's very important to our family to balance receiving gifts with giving during the holidays.

Santa: $200

We have four children and, in our family, Santa does not bring gifts for adults. So, $200 breaks down to $40/child plus an extra $40 to fill each stocking. Simple stockings make this category work—they definitely don’t need to be filled with $100 worth of trinkets and/or expensive, tiny things. I fill my them with a little candy, a small toy, an essential (like socks) and we—I mean, Santa—never forgets the tradition of an orange in the toe.

Charity: $125

It's very important to our family to balance receiving gifts with giving during the holidays. Our children are a big part in directing these funds because we want them to cultivate a spirit of caring for others. This year, we assembled Operation Christmas Child shoeboxes, chose a gift from the World Vision catalog and participated in the Giving Tree at our church.

Activities: $250

This is such a sneaky category! Typically, my calendar is pretty well outlined, so I know what’s coming and can estimate what the cost will be. As of now, I know we are spending $150 on a hotel stay, but I’m budget an additional $100 because my kids are talking about going ice skating and they always have hopes of seeing a movie in the theater during their school break.

Christmas Cards: $100

This is a tradition we just can’t give up, despite the expense. We love sending and receiving them! This year, $100 covered 75 cards from Costco and the stamps we need to mail them.

Food: $200

In December, I bolster our regular grocery budget with an extra $200. We celebrate with a prime rib during the holidays, and I go through quite a bit of baking ingredients, so that extra money helps keep our regular monthly food budget in line.

Decor: $160

Our biggest decor expense is our Christmas tree, which comes in around $60. The additional $100 covers lights we may need to replace and my day after-Christmas shopping fund. That’s right, to make this line item stretch farther, I shop for holiday decor, wrapping paper and the like (hello, Target!) on December 26 to prep for the following year.

There you have it—every dollar has a name, and outside of any huge surprises, this Christmas will cost us a total of $1200.

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