Perfectly thoughtful gifts for 15 people = $750
Homemade cookies for neighbors & coworkers = $50
a new nativity because my old one is so 2013 = $25
ugly sweaters for the whole family, because that’s a thing now = $50
Christmas cards = $200
Different cute dresses for all the holiday parties = $100
Hostess gifts for all the holiday parties = $30
Christmas decor = $50

TOTAL = $1255

That is a totally made up list, off the top of my head, in 30 seconds, with guesses about how much those things might cost. I didn’t even factor in the cost of hosting holiday parties, stockings, pinterest worthy wrapping supplies, getting professional pictures taken, and on and on. And if your monthly budget already feels tight, and you haven’t saved in advance for Christmas, it can feel almost impossible to do a debt free Christmas. 

But, here’s the thing. Christmas is as expensive or as cheap as you make it. You have control over a lot of those things. All, actually. Would it be easy to skip out on all the Christmas traditions this year? No.

But would people understand if you sent an email instead of a card, or made them dinner instead of buying a gift? Probably.

Listen, I love holiday traditions as much as the next gal… cute wrapping paper and all. I’m not about guilting people into spending less just for the sake of saying, “Look, I spend less!” And, I’m not against spending money on all those fun things.

If you have the money.

Can I just say: give yourself, and others around you, grace.
That’s what Christmas is about anyway… grace.

In a Creditdonkey.com survey, 37% of people said they use a credit card to finance Christmas spending (source). Mirror, a British news website noted in an article last month, “More than 82% who spent more than they earn struggle to pay it back, with 20% of the 2,000 people surveyed still trying to clear debts from the holiday season eight months later.” I’d be surprised if the numbers in the United States were much lower.

I understand that this cycle would be very hard to break. If you have been funding Christmas on a credit card for a couple years (or several), you might spend the following January through June paying it off. Therefore, you probably don’t have the money to save up for Christmas for the following year. Or maybe you’d have the money to save up for Christmas, but not the will power. Because it feels defeating and exhausting to think about since it’s become a source of frustration and tension.

I also understand that it feels a little late now (although, not too late). We’ve been there. One year, we kinda sorta budgeted and thought about saving in advance, and all of the sudden, we were out of time and stuck scraping together the money last minute. The next year, we swore, we’d save up for 12 months. We probably saved for 8 and didn’t save enough compared to what I wanted to spend. Woops.

Just… Break the cycle.

Make it stop.
If you have to, don’t give any gifts one year to catch up.

What would happen if you approached your family and said, “This is hard for me to do, but this year, we are getting out of debt and are refusing to accumulate anymore consumer debt. Therefore, we are choosing to do a debt free Christmas, and don’t have any money to buy gifts. We would love to get together and do a game night and family dinner instead to celebrate Christmas with you.”

I don’t know your family. Bringing that up might be really hard. It might cause a lot of drama. Or it might not. (Especially if you were making a lot of other sacrificial lifestyle changes in order to get out of debt.)

Regardless of how extreme you choose to be, you can do a debt free Christmas. If you make up your mind that debt is off the table, that you’re cash flowing Christmas this year, then you can do it. The more debt we pay down, the more I’m convinced that this whole money handling business is mainly emotional, with a tiny bit of 5th grade math mixed in.

You’ll just need to start planning. Now.

It’s October 1. If you want to go Christmas shopping in early December, that gives you 2 months to save up some Christmas spending money. It’s not too late. Even though Ben and I are currently getting out of debt like crazy people, we still budgeted a little money for Christmas this year.

Part of the trick to staying out of debt at Christmas is thinking ahead about 2 things:

  1. What will you be buying?
  2. Where the money is coming from? (Spoiler alert: not a credit card)

Even a couple months of planning helps you save because you’ll get to take advantage of more sales and you have more time to side hustle for cash.

Can I suggest some homework related to those 2 questions? It’ll probably take 10-15 minutes.

  • Make a list of all the Christmas expenses you want to spend money on. Look at my list up top to get you thinking about all the different things.
  • Look at your monthly budget & decide where this money is coming from.
    • you can cash flow it (which means you already have enough expendable income in the next 2 months to cover all your Christmas expenses. it also means this post is mostly irrelevant to you. good job.)
    • you will cut other expenses down and save all the extra money
    • you will find some side hustle to make some extra dough
    • you will cut some things off your list

Did you see the last option? You might need to cut some things off your list. If you feel stressed right now, cut some things out. People will understand. You will still enjoy Christmas. You don’t have to do it all.

One thing we cut: those adorable photo christmas cards. You may be rolling your eyes at the trend, but I love pictures & I love snail mail. I love getting everyone’s smiley-picture Christmas cards and displaying them on the wall. I love reading everyone’s long letters about their years. I also like sending snail mail. I like writing a note by hand, addressing the envelope and dropping them in the blue mailbox. BUT, we’ve decided that’s not a priority right now based on our budget and debt-payoff goals for 2015. Of the money we’ve set aside for Christmas, we’d rather buy a few people gifts and just send a Christmasy email.

There’s always next year. Christmas gifts and parties are fun. But they aren’t worth stressing out or going into debt to buy what you can’t afford. Plan ahead. Break the cycle. Make it stop.

Choose grace and peace this Christmas instead of chaos and stress.

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A debt free Christmas can sound daunting: start saving now! Here are some ideas for having a debt free Christmas this year.