Don’t Be Broke in January: Plan Now for the Holiday Expenses

Don’t Be Broke in January: Plan Now for the Holiday Expenses

Ah, the Holidays! That time of year for gift-giving, delicious food, and of course, financial headaches our to holiday expenses.

If you find that this time of year is more financially stressful than enjoyable, keep reading so that you won’t  be broke by January.

Establish a Budget for Holiday Expenses

Include in your budgeting plans a line for holiday expenses and an estimate of how much you will need. You can go further and create a list of what you will need. For example:

  • Gifts: Make a separate list of whom you will be giving gifts to.
  • Meals: Will you provide one holiday dinner or are you expecting the family to visit for a week?
  • Decorations: Do you plan on adding to your decorations collection or putting up new lights?
  • Travel: Will you be visiting relatives? Make individual lines for gas, plane tickets, hotel, etc.
  • Activities: Often families have a favorite holiday activity they do together.

Estimate expenses based on previous experience to determine what your costs will likely be. Do this at least six months in advance so that you can begin saving the money you will need.

Get a Jump on Holiday Purchases

These days, it seems we start seeing holiday advertising even before Halloween! For the smart shopper, this can work to your advantage, especially if you have already made your holiday budget and gift list. Rather than doing all of your purchasing in the last month-and-a-half of the year, you can spread out your purchases over a much longer period of time. This means that you won’t break the bank or have credit card debt in January. Another advantage to buying early? You get to skip the mad rush of December shoppers too!

Remember to Put Yourself First

Even though you want to give gifts to your friends and loved ones, you have to remember to put yourself first financially. That means continuing to contribute to your retirement funds, paying the bills, etc. It may be tempting to skip making a contribution or holding off on deposits in your savings account. Don’t do it! These are important steps that you need to keep making so that you can retire comfortably. Certainly, you don’t want to take out a loan or incur a large credit card bill just because you want to make everybody happy. In the end, they get a present, but your lingering gift is a financial headache.

Get Creative with Gift-Giving

There are lots of ways that you can get creative when it comes to gift-giving. For example:

  • Utilize a credit card that provides a cash-back or rewards program throughout the year. Then, when you make holiday purchases use those points instead of cash or credit.
  • Consider working with other siblings or friends to pool resources when purchasing an expensive gift for someone.
  • Harness your creative talents to make a gift.
  • Create an I.O.U. for a later date when you take a friend or loved-one out to dinner, a movie, or a concert.

Communicate with Your Partner

Make sure that you and your partner communicate about how you intend to use your money during the holidays. Remember, one person shouldn’t have to shoulder all of the planning or all of the financial burden. If you both work, discuss how to split the holiday spending in an equitable way. Be sure to respectfully hold each other accountable to the budget and don’t get carried away with impulsive shopping.

The holidays should be a time of joy and the coming-together of family, not financial worry. Therefore, by making plans early on, sticking to a budget, being creative, and communicating with your partner, you can ensure that your holiday the joyous experience you hope for.

Denise Kautzer is a Licensed Professional Clinical Counselor and a Certified Public Accountant whose practice is located in St. Paul, MN. You can view her website at or contact her at