I'm a planner, always have been, always will be! I do not like to have a month with monstrous size bills, especially January right after Christmas. A few years back, when my husband quit his job (you can read our whole journey here) to finish school and stay home with our kids, we tried to keep our monthly expenses as even as possible every month. This is when we started saving for Christmas in February! Our goal is to have all of our money saved up by November, that way we can pay cash and not have any "typical" holiday bills after the holiday!
Here are a few keys to success, to start your Christmas savings account now!
- Pick a place to "house" your money so that you will not touch it over the course of the year. It may be a jar in your kitchen cabinet, your local bank or credit union, or an online banking institution. We have exclusively used Smarty Pig over the past several years. It allows you to set goals and see your progress to your end goal! Smarty Pig is free and pays a 1% interest rate. You can also earn more when you cash out your savings into gift cards.
- Make the monthly contributions automatic and part of your monthly budget. It you are committing to saving $100 a month, have that money automatically withdrawn and put in your designated "savings" account. That money is off limits and for a single purpose, Christmas!
- Make a Christmas budget now and stick to it. Here is an example of a $1000 budget we have used in the past:
- Our 3 kids at $200 each = $600
- Nieces and Nephews = $100
- Parents = $150
- Sisters and Husbands = $100
- Wiggle Room = $50
- The sooner you start, the easier it will be to reach your goal. We prefer to start in February, just because we have some other bills that come due in January. If you get a tax refund, make part of this refund your first deposit. If you have an extra cash at the end of another month, add it to your Christmas savings. You can accumulate your budget mount quicker, than originally thought!
The holidays can be stressful enough, make next Christmas as stress-free as possible by establishing a budget, saving the money in advance and then stick to the budget!
Disclosure: You can earn a $10 referral with Smarty Pig, if you would like to be referred, please send me an e-mail at firstname.lastname@example.org!