Our Best Christmas Ever
Photo by: Kurt Magoon
As I write this article, I am surrounded by boxes, new gifts, and the remaining bits of wrapping paper. Our house is in a bit of chaos, but that’s alright, it was a wonderful Christmas both financially and emotionally. This Christmas was one of our best Christmases ever.
This was the first Christmas that I can remember where we didn’t rely on credit cards. In the past we would have used whatever spare cash we had to purchase gifts and then rely on our credit cards to pay for the rest. We seldom stuck to a specific budget and frequently purchased gifts for our children and for ourselves that were way beyond our means. This year was different:
We started saving for Christmas a year ago
We made the decision early last year to cut up our credit cards and no longer use them. As part of this decision, we looked at all of the various expenditures we relied on our credit cards for: property taxes, overspending, Christmas, special occasions, etc. For known upcoming expenses like property taxes, special occasions and Christmas we began setting aside money each month. I talked about this already in a previous article, but wanted to share a little more detail with you.
To do this, we determined the amount we would need and and how many months from then we would need it. For example, for Christmas our amount was $1800.00. Since it was January, we had 12 months before we needed the money and thus started putting away $150.00/month into a special ING Savings account named “Christmas Fund”. I made these deposits automatic and a fixed line item in our budget.
We applied the same principles to our other upcoming expenses.
We budgeted our Christmas fund
In November we budgeted the $1800.00 up across all of the various people we would be purchasing gifts for, including ourselves. We set an amount for each of our children, our parents, our friends, and ourselves. For our children we tiered the amounts, giving our oldest a higher budget amount since the items we wants are generally more expensive than our younger children. Madison over at My Dollar Plan wrote about this same topic of spending different amounts on children.
We purchased our gifts using a special checking account
We started purchasing our gifts early to avoid the Christmas rush. I transferred the money from our Christmas fund into our ING checking account and we used the associated debit card to pay for all of our gifts. This kept up us from mixing our normal income with our Christmas expenditures. In other words it avoided another potential area for overspending and allowed us to easily track our Christmas spending and budget.
No Stress this year
While we have always enjoyed Christmas and I certainly don’t want to imply we haven’t enjoyed it or looked forward to it the past, but until this year there was always a level of stress we had to deal with. Always that feeling of dread as I thought about how much further into debt we had slipped, wondering how we would pay for it, and dreaded seeing the credit card bill in January.
Not this year. This was the first year we didn’t stress nor even think about money. We paid for all of our gifts in cash and never touched our credit cards once. No new debt, no feeling of dread, no stress. This year we were able to relax, enjoy spending time with our family, and playing with the gifts our children received knowing they were 100% ours and paid for. It was truly our best Christmas ever.
How was your Christmas this year? Did you use credit cards this year or did you use cash? Was it another stressful Christmas for you? Share your story by adding a comment below.