How to create a holiday budget and stick to it

We all know the holiday season can be downright expensive, and even well-intentioned shoppers can end up with last-minute costs that really add up. But it doesn’t always have to be that way. Here are some key steps for making a holiday budget and tips for staying the course.

Your budget

  1. Set a spending limit. Just like a regular budget, start by figuring out how much you can afford to spend this year. If you haven’t set aside some money throughout the year, look at your income, regular expenses, other savings and how much money you can put towards the holidays.
  2. List your holiday expenses. Be detailed and specific — include not only who you plan to give gifts to, but also food like holiday dinner and baking supplies, holiday activities, greeting cards, new seasonal décor or outfits, as well as small essentials like wrapping paper and ribbon.
  3. Determine your needs and wants. Review your holiday expense list and think about what’s essential and what’s just nice to have. Prioritize your list this way, so you have a sense of what you’d be willing to spend less on and what you might not need at all.
  4. Divide your budget. Now you can allocate your total spending across the expenses you’ve listed and prioritized. It may take a few tweaks to get something you’re comfortable with that’s also realistic.

Sticking to it

With your holiday budget in hand, all you need to do is follow it. A few ways to stay on track while enjoying are to:

  • Reduce costs by shopping early, comparing prices and scoring at sales like Black Friday.
  • Prevent impulsive spending by keeping a list of financial commitments, like car payments, in your wallet to keep you motivated.
  • Use pre-paid credit or gift cards for holiday spending to limit over spending.
  • Carry your budget with you and keep track of all holiday purchases.
  • Communicate with family and friends about new expectations or shifts in tradition.
  • Make DIY thoughtful, low-cost gifts or greeting cards.
  • Create more affordable traditions like skating at your local ice rink.

If you’re not feeling confident in your money skills and need some support, there are many resources available from the Money Matters financial literacy program. You can find free online resources and courses to brush up on topics such as spending plans and ways to save at