How Do I Afford Christmas if Money is Tight?

If your finances are tight after getting divorce, the holidays can seem more stressful than cheery. And you've probably been asking yourself "How do I afford Christmas this year"? With some careful planning and ingenuity, you can get through the holidays with your budget intact. Here are some practical tips to help you navigate the season without overspending.

How to Celebrate Christmas on a Tight Budget

By Tracy Achen

Cute piggy bank hiding in Santa's cap

It's a good idea to start thinking about your Christmas budget before the holiday frenzy starts. First of all, determine how much you can comfortably afford to spend during the holidays. Include everything, such as gifts, food, cards, postage, stocking stuffers, and gift-wrapping supplies. Hopefully you'll have some items left over from last year (like gift wrap and cards), so these items don't need to come out of the money you budgeted for Christmas.

Next, make a list of everyone you absolutely want on your gift list and work out how much you can spend on each person. If possible, budget a little extra for unexpected expenses.

Reconsideration Your Gift-giving Traditions

When times are tight, you need to be realistic about your gift list and whittle it down to fit your budget.

If your kids are old enough, it's time to sit them down and let them know that Christmas will be tight this year and not to expect a lot of gifts. Ask them for ideas on what they would really like (you might be surprised). If they are dying for the latest game system, let them know that if it happens, it will be a gift for the whole family. But you really do need to be honest about the situation.

If your budget allows, you can continue giving gifts to the rest of your immediate family and your parents. If there's enough money left over, then maybe include your brothers and sisters if you customarily exchange gifts. Everyone else can get a Xmas card with a nice note inside. You might explain that times are tight and you're cutting back. This might even ease future Christmas budgets if you've been gifting out of a sense of obligation.

If your family traditionally gives gifts to each person, suggest drawing names instead. This will help everyone's pocketbook. You can also plan a special evening together for the family and have everyone bring their favorite dish. Afterwards, spend time together playing cards, watching a movie, or doing a jigsaw puzzle.

Think Outside the Big Box Stores  

Try to get creative when you're shopping for gifts. For instance, check out the clearance racks at your favorite stores for great discounts. You can also go to your local drugstores for small toys and board games or visit online auctions sites for affordable gifts. Before heading out the door to go shopping, scan the Sunday ads to take advantage of the current sales. A lot of stores also offer coupons and discounts on their app.

And don't forget about the dollar stores. You can find some really unique items at a price you can afford. Just go in with an open mind and take your time so you can find the best deals.

When things are really tight, there is no shame in shopping yard sales and second-hand stores such as Goodwill, the Salvation Army, and local thrift stores. You can find some really unique and great gifts and sometimes even score new items. Just look for things that are in good or "like new" condition that your gift recipients would really love. It takes a little time, but it's definitely worth the effort.

Get Creative with Gift Giving

If you have a little spare time, think about making gifts for some of the people on your list. You can find a lot of inspiration on our affordable gift ideas page.

Another option is to give the gift of your time. For example, you can create coupons for free babysitting, car or house cleaning, yard work, etc. Just be sure you are willing to follow through with the gift.

I did this for my mother by making coupons which she could "cash in" for a whole day doing whatever she needed. She actually used her coupons to take care of some of the yard work she needed help with. Not only did we get to spend the day together, it felt really great knowing I helped her out. And she didn't have to feel guilty about asking for my help.

Review Your Christmas Card List

You might consider cutting back your Christmas card list like you did your gift list. Go through your list and really think about who you enjoy sending cards to and cut back accordingly. If you send a card to your old high-school buddy every year but never hear anything back, maybe it's time to mark that name off the list. And if you can't quite go cold-turkey with these people, consider sending an electronic Christmas card instead. There are many sites which offer a wide variety of free e-cards, such as 123greetings or Blue Mountain.

For the remaining people on your list, realize that you can find some really nice cards for a very reasonable price at many dollar stores. So what about printing your own cards? Before you start, take into consideration how expensive printer ink is. Plus you'll need to buy card stock and envelops to print them out. Many times it's cheaper to just buy a box of nice cards.

Plan Affordable Meals

Once again, advanced planning can make a huge difference in your budget. Watch the sales ads for specials on turkey and ham and freeze them for later. Think about all the ingredients you normally use for your holiday meals and parties and buy them when they go on sale. And also consider store brands. The store brand of green beans, pie fixings, and other holiday fare is usually just as good as the name brand items and often costs a lot less.

You can also check out the local food bank or various church pantries around town if things are really tight. They often offer many of the ingredients for holiday meals.

Get a Jump on Next Year's Holidays

Going through a tight Christmas is never fun, so it's a good idea to get a start on next year's holiday right after Christmas. The best way to do this is to shop the after-Christmas sales. You'll be able to buy gift wrap, cards, decorations and more for up to 75% off. You'll also find mark-downs on stocking stuffers and pre-wrapped gifts that can work for next year.

Consider buying Christmas gifts throughout the year. After all, it's a lot easier to afford one or two presents a week as compared to buying everything right before Christmas. Plus, it's easy to overspend when you're on a deadline. Throughout the year, shop the clearances at your favorite stores. Keep a list of people you usually buy gifts for in your purse so you can see if any of these bargains would make a good present for someone. If you do buy something, be sure to write it on your list so you can keep track of everything and not double up on gifts.

And most importantly, start saving earlier than you did this last year. By setting a budget for Christmas and starting your savings in January, you'll easily be able to afford Christmas next year. You can open a savings account and have money withdrawn automatically from each paycheck. Or you can personally deposit a set amount each week. You can also start saving all your loose change. You'd be surprised at how much pocket change adds up over time.

Final Thoughts

It's important to realize that the true spirit of Christmas resides in the heart and is not measured by how fancy your house is decorated or how expensive the gifts are.

So how do I afford Christmas? I do so by using the tips above and some of the suggestions found in the articles below. With a little ingenuity, you can make the holidays festive without totally sacrificing your budget.