Save Money Before the Holidays Near With a Christmas Saving Plan

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Don’t you want to scream when you see Christmas displays in the stores before Halloween? Or when “It’s Beginning to Look a Lot Like Christmas” is stuck in your head for two months because it starts playing in early November?

The Christmas creep can be annoying, but there’s at least one good reason to start thinking about the holidays before the leaves start changing color: It gives you more time to save.

Given the current trajectory for holiday spending, you’re going to need that secret savings stash. The National Retail Federation found holiday spending rose 14.1% in 2021 with US consumers forking over a whopping $886 billion to spread a little holiday cheer.

Waiting until November or December to prepare for these expenses means you’ll often end up charging your purchases and paying them off — plus interest — well into the new year. Instead, establish a Christmas savings plan now to avoid debt and overspending.

6 Steps to Creating Your Christmas Savings Plan

Not sure how to squirrel away extra funds for the holidays? Here are six easy steps to get you started.

Step 1: Start With the End in Mind

To save enough money to cover all your holiday expenses, figure out how much you plan to spend and divide that by the number of weeks you have until it’s time to start shopping. That will tell you how much money you need to save per week to build up your Christmas fund. In the personal finance sphere, we call this setting up a sinking fund.

Step 2: Make a Gift List

To estimate your overall savings goal, first make a list that includes who you’ll be shopping for and how much you’ll spend on each person. It may be helpful to refer to what you spent last year. Or you could research the prices of items you plan to purchase for each person and total them up.

Step 3: Check it Twice

Heads up: Your Christmas savings plan needs to cover more than gifts. So add estimated costs for decorations, food and holiday events to your shopping…

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