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Dave Ramsey Talks Christmas Budget

Help in Making Your Christmas Budget.                                                                                                                        

 

Christmas is the best. You get to hang stockings, shop for your favorite people, and potluck like a champ. There’s no other time of the year quite like it. That’s why it’s so easy to get carried away with your seasonal shopping!

Dave Ramsey

Dave Ramsey

In fact, last year’s annual Gallup poll found that nearly a quarter of Americans anticipated spending $1,000 or more on Christmas. That’s a decent chunk of change for any budget. While it’s perfectly okay to spend extra money around the holidays, you don’t want to end up with the unwelcomed gift of credit card debt come Christmas morning.

Here’s how you can make your Christmas budget brighter:

  1. Figure out how much you can spend on Christmas
    Let’s go ahead and address the question on everyone’s mind: How do you figure out your Christmas budget? Start by figuring out how much you spend on your normal monthly expenses, like gas, utilities, insurance and groceries. Then take a closer look at your flexible spending budget groups like dining out and entertainment money.

If you typically spend $300 on restaurants in a month, why not cook a few extra meals at home and divert an extra $200 toward Christmas savings? Or if your personal money is partying it up at $150, why not hold off (temporarily) and put an extra $100 into your Christmas stash? Smart budgeting now can free up more money for what you want later—like Christmas presents!

  1. Divide your Christmas budget into categories
    Once you’ve figured out how much you can spend on Christmas, do some dividing. Take your number—let’s say $500—and think over your seasonal expenses. You’ll need money for travel ($50), tree and trimmings ($50), a few potlucks and parties ($50), and some extra giving ($50). Then there’s the Big Kahuna: Christmas gifts ($300).

As long as you plan where you money will go before you spend it, there’s no right or wrong way to split up your Christmas budget. Plus, if that Evergreen goes on sale, or you economize on your potluck groceries, that means more money to splurge on your loved ones.

  1. Write down who you need to buy gifts for 
    Now that you know exactly how much you can spend on gifts, decide who gets what. Make a list of everyone you’ll buy for this year. And we mean everyone—coworkers, church friends, your parents, your kids, your grandkids. Next to each name (or category, if you’re budgeting a treat for the office), write a specific dollar amount.

If you don’t have enough money to cover everyone on your list, rethink how much you’ll spend on each person. Maybe you can agree to only buy for the kids. Or perhaps you can draw names, instead of buying for multiple families. And then there are always baked goods or homemade crafts! Who doesn’t love a gift that comes fresh out of the oven or straight from the heart?

Give yourself the freedom to enjoy

You probably have a lot of great ideas on how to spend your money this season. When you start with a plan, you’ll be in control of your Christmas budget long before setting foot into the mall. All you have to do is set up your monthly budget, categorize your Christmas savings, and make your detailed gift list. After that, enjoy your Christmas shopping—because your budget said you could!

Courtesy of Dave Ramsey, EveryDollar.com

*EveryDollar is a simple, online budgeting tool that helps users set a monthly budget and seamlessly track expenses. For more information, go to www.everydollar.com.