To me, Christmas on a budget (and I mean a VERY small budget) is really stressful. I’m a stay at home mom and just can’t spend much money at Christmas. It would be easy to spend $500 (but I can’t) on gifts for our kids plus siblings and parents on both sides. There have been years that I’ve wished everyone would just stop doing gifts altogether or trade $5 gifts or at least do a drawing so everyone could just buy 1 gift.
If you feel Holiday stress because your budget is busting at the seam, then keep reading. I’ll share ways we have learned to have a frugal Christmas and enjoy it MORE. This is going to be the Christmas season you enjoy rather the one that you dread!
Christmas on a budget
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To really stick to your budget for Christmas, you have a few options:
- Get everyone something small, even if it’s less than they’ll probably spend on you (My recommendation).
- Don’t do any gifts and let everyone else know beforehand so it’s less awkward later. (I don’t want this as I want to experience the joy of giving and teach my kids that too).
- Divide what you can spend between the people you have to buy for to see what you can spend on average per person.
- Find super cheap gifts on sale or used (I’ll explain where we find stuff).
- Plead with your extended family to do a gift drawing.
- Make something for everyone (a DIY gift, like candles or an ornament).
Until last year when we moved away, Peter and I alternated which family we spent Christmas with, and a few times we managed seeing both. His family typically exchanges smaller gifts (say $10) while my family typically exchanges larger gifts (say $50 range), and everyone gets everyone a gift.
This adds a minimum of 20 adults to shop for and that stresses me big time. Sorry if you are my family reading this right now, haha.
If we got everyone on both sides one small thing around $10, we would spend over $200 minimum, and that doesn’t include any gifts for each other or friends.
How to form a frugal Christmas budget
When it comes to spending money on presents, I’m first forced to deal with a few key issues every Christmas. Usually, I have an amount that I’m comfortable spending total. And that has to get divided between everyone. So either each person gets a smaller gift in general, or I buy for less people.
- The embarrassed feeling I get when I can’t give a gift back that is similar in value to everyone.
- What to gift people that’s small, unique, or special?
- If you’ll exchange gifts with your spouse and if so, what’s the limit?
- What to do when there are lots of people to buy for?
- How do I create a Christmas around traditions rather than presents?
- How do I plan better so that I can spend some extra money on presents?
- What homemade gifts could I possibly make?
- How to present it well? This is HUGE. Anything small can be wrapped well and garnished with extras (chocolate being our fav).
What’s a reasonable amount to spend on Christmas gifts?
While Dave Ramsay said the average family spent $800 last year on Christmas stuff and the average American family makes around $50,000, this is a completely personal question and not a good guide in my opinion.
According to this I could feel justified in spending a little less than $800 and if I did that I would keel over in a panic attack. I’m more comfortable with a couple hundred and we have A LOT of people to buy for. I’d much rather spend less and pay off some medical school loans or save for a used car since my husband’s is on it’s last leg. Just saying.
Check out Money Saving Mom’s post to see over 160 answers from other families responding to “What is a realistic Christmas budget?”
Why Christmas on a budget is good for kids
I don’t know about you, but if I buy my kids something expensive then I seem to expect them to LOVE IT, play with it for months, and take good care of it. Does that ever happen? Not really.
I’ll get disappointed if they don’t seem to care about it, and even resent them for it. This is STUFF we’re talking about. Yuck.
Did you know it’s totally ok to just give your kids a few gifts? Their friends may get 10, including a remote control car and brand new play house. But hear me out. You don’t owe your kids that. Especially if it means spending money you don’t have.
I LOVE to give my kids special things, but too much really can spoil them. Kids get spoiled easily. They get tired of things. And Christmas can quickly turn into how many gifts they have. Even if I find great deals, or could buy 30 used toys for cheap, I won’t. And it’s hard, because I want to get them everything!
Even if I have huge budget someday after our medical school debt is paid, I don’t want my kids to feel like they deserve getting whatever they want. I’m defiantly guilty of spoiling my kids at times by thinking only of their instant happiness rather than long term character. Workin’ on it ;-)!
Start a few traditions that are FREE or cheap
This should be fairly easy with little kids, and it can take the focus off of opening presents. (Since opening a few gifts doesn’t take much of the day at all)! Some budget ideas might be:
- Play a new board game (thank you thrift stores).
- Teach your kids UNO.
- Go on a drive to see lights at dusk.
- Make cocoa and watch a movie together.
- Pop some popcorn and make a popcorn necklace to eat.
- Do a craft.
- Surprise a neighbor with a gift.
- Invite someone without family over for dinner.
- Make a picture out of different beans and glue.
You may also love: Easy DIY burlap bag advent calendar: No sew and no glue
How to handle giving small gifts to someone who always gives expensive ones
This is SO hard for me. Like I want to secretly beg them not to buy me anything. Here’s what I do. I thank them, appreciate it, send them pictures when I use it. But I gift them something I can afford which often costs MUCH less money. And I wrap it as stinking cute as possible with inexpensive add ons like chocolate.
It kind of sucks to open a really nice Nordstrom sweater and give a sugar scrub in return. Like, I’m embarrassed. But that’s me being real. Raw. Not stingy and rude. I just can’t spend that much on everyone. And I hope they know, but that’s not in my control.
I have to be true to my budget and my situation. I can’t spend WAY more on just that person because they spend more on gifts than me.
If you do this once, then you kind of set a precedent for the next year too. I’ve found people actually spend less on me after a couple years of me doing homemade gifts…and I LIKE that.
Saving money on your spouse
Since Christmas is way more about our kids now, we actually just don’t get gifts for each other. We did when we were first married, but it’s an easy way to save $50-$100 on a somewhat obligatory gift exchange.
I think I’d actually rather him give me some time to myself as a gift. Husbands if you are reading this, that’s the BEST gift you can give a tired mom.
Christmas Shopping Tips
1. Stop here and sign up for Rakuten!
Rakuten is a gem I found a few years ago back when it was Ebates, and all you have to do is sign up and install the button. Then shop like you normally would and click the “Activate Rakuten” button that will pop up in the corner of your screen to earn cash back (anywhere from 1%-25% usually, and insane deals around the holidays and Black Friday).
Get $10 cash back after you use it for the first time. Feel free to read how I’ve been paid over $400 cash back in my post: How Rakuten works to save you money + $10 sign up bonus
2. Here’s where to get Christmas gifts half off or better
My favorite site I check before buying anything is called Vipon. This is Amazon’s discount site where everything is 50% off or better. Basically sellers can offer discount codes here hoping that you will become a repeat customer or tell others, but there is absolutely no obligation.
It’s the perfect place to save money on NEW gifts in every category. They always have an impressive selection of toys, kitchen gadgets, electronics, and random stuff. Snagshout is another site we use a lot, and it works just like Vipon.
Where to find nice used toys and gifts
The hard part about finding used things is that you usually can’t find “the item” someone has on their wish list. This isn’t a big deal with little kids, but for older kids it may be worth doing one nice present and hunting for a good deal. We get used gifts from:
I know some people are repulsed at thrift stores and gifting used things (for family), but I challenge you to ask why. Ya 75% of thrifted stuff is junky, but there are gems there that you could gift that look nice IF cleaned and packaged correctly. Ideas:
- Clay mugs
- Toy sets
- Cool art
- Old or classic books
- New craft supplies (I see this all the time)
- Board games (check for missing parts)
- Dress up sets for kids
- Cool plant pots (just add the plant)
Invest in a few Christmas wrapping supplies and you can do wonders with the presentation.
Also, used toys for young kids just makes sense. We just found this bow and arrow for my son for $1.25 at Goodwill, and he is happy as ever but we could not have justified buying it new on our budget. Remember my budget is not yours, so don’t feel bad if you can afford more and want to spend more on gifts than I do!
Keep a hidden Christmas present bin all year
My mother in law does this (she has 12 kids so it’s just smart)! You can alleviate the stress of spending so much all in December by finding deals year round. Or just grab one extra thing here and there everyone loves like candles, edible things, cute mugs, or art supplies.
A system like this with a few kid items has come in handy for us when someone invites us to a birthday party too. Then you can quickly grab something from the bin.
Shop the week after Christmas
Not my idea of restful, but o my goodness everything is like 75% off or more!
A few years ago I was 100% unprepared for Christmas and hadn’t gotten any gifts for my side of the family at all…and we were on our way there. I’m stressed just remembering this. We left my husband’s family December 26th to go to mine, and stopped to get gifts at World Market on the way.
I left thinking, why don’t we start celebrating this holiday a few days later than everyone and save a ton of money? Haha. Probably never going to do that though.
The tricky part about shopping after Christmas is that I’m already low on cash. Soooo, that would have to be planned AND stored for future presents.
I have my own Mary Kay business that is mostly for personal use, and one year I traded one of my customers make up for her homemade sugar scrubs. We traded and I used them as gifts that year! We both saved money that way.
If you have a service or product to sell, ask around on some of your Facebook groups or at church or work to see if anyone sells something and would be interested in trading!
Homemade Christmas gifts we have made
On the years we have been unable to buy everyone presents, we have gotten on Pinterest and figured out what the heck we could possibly make. Ya, this kind of sucks because it takes WAY more time. But, I will say, it’s also super special.
We have given:
- Homemade candles ( A surprisingly HUGE hit). I bought used pillar candles at a thrift stores and melted them together in a junky pot. Then I bought a pillar candle mold, a roll of candle wicks, and candle mold sealers to keep the wet wax from falling through the hole. That way I didn’t need to find and clean 15 glass containers! You can also skip used candles and just buy bulk wax nibs. Leave a comment below if you’d like a post on how to make candles and I’ll write one!
- Homemade fudge in cute boxes (A total drag because my whole family was on a diet that year, apparently) and I’m pretty sure no one was excited to get that, although everyone did say thank you. O well.
- Homemade infinity scarves. This was my intro to sewing project and I think I made like 6? Everyone was really sweet buuuut, I don’t think they looked THAT great. That’s what we call a good try, haha.
- Handmade cutting boards. Anything crafted from wood is AMAZING! My dad let us use his shop and scrap wood he had. Everyone loved these. I still use mine years later and this is how we clean them when they get stinky.
- Sugar scrub: Just takes sugar, oil, soap, and essential oil for scent. Much of this is in the packaging. You could wrap one jar and easily add an inexpensive loofa, white hand towel set, or chocolate.
How to save money for Christmas
Do a no spend month to save money for Christmas
If you are terrible at budgeting but want a quick way to save an extra $100+ a month for Christmas, try doing a no spend month! We do this when we need to save money and always end up saving at least $200-$300.
Basically we just buy gas and groceries for a month plus bills. No eating out, no trips, no clothes, no babysitters. Here’s how we do a no spend month.
Sell some of your kid’s toys.
Did you know people are looking a couple months before Christmas for gifts, and for sure the whole month of December? List any toys you could get rid of and use the extra cash for gifts. Local Facebook groups are great for this or Facebook Marketplace.
How to make an extra $100-$200 for Christmas gifts from home
I’m hugely thankful that I found website usability testing. Through a company called User Testing, I gave my opinion on sites for Nordstrom, Target, Best Buy, and tons of others.
It was easy, I could do it on my own time when the kids were in bed, and it paid $10 for 20 minutes of my time (paid exactly 7 days after I did the work, via PayPal).
They want to know how customers might think, what might make them click away, and they are willing to pay for it. One 20 minute test a day would be $300 extra in your pocket every month! Here’s my full post on how to make money doing website usability testing.
How do you do Christmas on a budget?
Now it’s your turn to share any tips with me. How do you budget for your family? I feel like Christmas should be a wonderful time with your family and if gifts are completely detracting from that, then it’s a good sign you need to cut back.
Hope you’ll share your best tips and use a few of mine for restful debt free Christmas!