Debt and Christmas go hand in hand for many Americans. In fact, based on this survey 52 percent of those in debt whipped out a credit card to finance their Christmas in 2014.
Now, I’m not knocking the use of credit. If you have the money in the bank to back up those purchases you make, then that’s a different story.
I don’t know about anyone else, though, but I would rather sleep right through Christmas day before I go into debt to purchase gifts for anyone, kids included. Fortunately for me, it’s been years since I’ve felt the need to do so and I’m so thankful for the change in mindset.
For those of you who don’t want to pay for Christmas well after the holidays are over, this post is for you. I’m sharing 26 ways you can have a debt free Christmas this year. Grab some tea and take notes!
1) Set a budget now.
The first key to having a successful debt free Christmas is to create a holiday budget. You’ve got a few months left before Christmas so think of the amount you’ll need or a spending limit for each gift and work your way backward.
If you have 7 remaining paychecks before Christmas and a $700 goal, you’ll need $100 per paycheck. Get it?
Once you have a budget in hand, commit to a maximum gift amount per person and get shopping. Here’s my latest holiday gift guide to help you get started!
If you need to make more money for Christmas, check out how you can boost your Christmas savings fund in 20 minutes per day.
2) Utilize credit card rewards.
If you’re a regular credit card user, you may have racked up a nice amount of credit card rewards that you can use for the holidays. And I’m not just talking Christmas gifts either. Perhaps your card provides travel rewards. Those will come in pretty handy for those of you who are going out of town this holiday season.
3) Avoid the biggest sale of the year gimmicks.
{insert eye roll} The “biggest sale of the year” is not the biggest, I’ll tell you that much. There is something waaaay bigger than the “biggest sale” and that’s scoping out those clearance racks for Christmas gifts and toys.
And don’t dare tell me it’s not true either because I personally shop the clearance rack before I look anywhere else. I have a whole BOX full of birthday party/Christmas gifts for the chirens. These are toys I’ve picked up for 75% to 90% off regular price.
Bonus Tip: Also, check clearance sections for nice candles and mugs. These make great gifts for teachers and friends!
4) Shop using Ebates to have a debt-free Christmas.
If you shop online and you don’t use Ebates, it’s like saying, “I’ll pay extra for this just because!” Seriously, check out Ebates. Heck, they even give you a free $10 gift card to a retailer of your choice just for signing up and making a purchase!
Related Reading: Shop Online Using Ebates and Get Free Cash Back
5) Check online before shopping in-store.
It’s nice to do a little comparison to see who’s going to give you the best bang for your buck. If you know one retailer will give you something for a certain price, you can check with your local competing retailer to see if you can get a better price.
For instance, at Lowe’s, if you find a better price on an identical item at a local store, they will match their price by 10 percent. All you have to do is bring in an ad!
See store policies for retailers like Target and Walmart as well.
6) Do you have a Target RedCard?
If you’re a regular shopper at Target and have a RedCard, 5% online and offline can add up over the year. Not only that, if you want to make a purchase online you can save on shipping costs. Utilize these extra perks this time of year to score extra savings.
And if you insist on shopping Black Friday and Cyber Monday, that extra 5% off will go a long way in reducing the overall price you pay for those little gimmicks just to get you in the store.
7) Take surveys for gift cards and extra cash.
If your cash is a little tight, take surveys for gift cards and extra cash. I’ve paid for many Christmas and birthday gifts using this strategy. The key here though is to start early.
Even if you won’t have enough points to redeem for gift cards or cash this year, there’s always next year. One of my favorite survey companies to work with is Pinecone Research. Of course, there are others, and here are a few more to get you started.
8) Host a Holiday Potluck.
Just because Christmas dinner is at your home doesn’t mean you have to do all the cooking. I mean, not unless you want too. If someone asks to bring something, politely thank them and tell them what to bring!
I name any and everything I can think of that will make my Christmas day less stressful. You can ask guests to bring drinks, silverware, dessert, side dishes, or all of the above.
9) Sell stuff you no longer need on eBay or Craigslist.
Make room for the influx of new stuff you’ll receive throughout the holidays. Check each area of your home for things you no longer use and list them on places like Ebay, Craigslist, or Facebook.
Not only will you be cleaning house, you’ll also be helping others stick to their budget when they purchase your gently used items. It’s really a win-win for all parties involved.
10) Use any unused gift card balances or sell them.
If you have any unused gift cards that you can’t use to purchase any gifts on your gift list, consider selling them! I recommend Card Pool because you can buy, sell, or trade gift cards.
You can sell them for up to 92 percent cash back or buy gift cards 35 percent off. You also can get 6 percent more for your gift card if you receive payment in the form of an Amazon gift card.
11) Choose a holiday decor theme.
Choosing a theme for the holiday will help narrow your focus and reduce the overall costs on decor. For example, a rustic holiday decor theme can be achieved using popcorn, cotton, twigs, sticks and pinecones.
All you need to do is head to your pantry, pop some popcorn, and have the kids go outside and grab some nature. You and the family can create decor using this stuff and save a lot of money.
12) Open a savings account just for the holidays and contribute year round.
I recommend creating a separate gift account and fund it year round. Not only will you have Christmas covered this way, but you’ll also cover all of those unexpected gifting events during the year like baby showers, birthday parties, etc.
Open an account with Capital One 360 with a minimum of $250 and you’ll get a $25 bonus to use for the holidays.
13) Give edible gifts instead of expensive gifts.
Try baking a few batches of cookies for your co-workers. Have the kids make some candy for their teachers. If fruit is on sale, create a gift basket for your pastor and his wife. Look for tin cans, disposable containers, and baskets at your dollar store and get creative. To get your juices flowing, here are a few examples below.
- 26 Freezable Christmas Cookie Recipes by Noshing With The Nolands
- 25 of the Best Christmas Candy Recipes by Living on a Dime
- Melted Snowman Bark by Tatertots and Jello
- Chocolate Covered Strawberry Christmas Trees by Lovely Little Kitchen
14) Save gift bags!
I never throw away gift bags unless they are damaged. You probably won’t believe me but just last year I got rid of the last girl baby shower gift bag that someone gave me at my baby shower from over six years ago.
I have all the gift bags! Weddings, baby showers, birthdays, Christmas, Valentine’s Day — all of them. If the gift tag has been written on, just rip it off and stash them in a bin until you’re ready to use them.
And yes, I make my kids take their gifts out of those used bags on Christmas morning just so they can be returned to the stash. Call me cheap, whateva!
15) Ditch greeting cards and go digital.
It seems like every other year the cost of stamps are going up and needless to say, no one really cares if they get a greeting card or not. I know I don’t. I used to do this every year but once everyone started sending Christmas texts and emails, I ditched the effort and joined the digital movement.
16) Give framed photo gifts.
Take a family photo and go to the dollar store and buy some frames. Grab some pretty ribbon at Michael’s or Hobby Lobby (using your 40% off coupon) and use it to tie around your frame.
These were the gifts we gave last year and it saved us a ton of money since we didn’t feel like buying a bunch of different gifts.
17) Don’t do Santa lists with kids.
I don’t ask my kids what they want for Christmas. Christmas ain’t about that. Now I will listen on the sly to things I hear my daughter express interest in, but I don’t make it a point to have her to create a crazy wish list.
I like to shop clearance during the year for affordable toys and then try to give each kid one thing they really want. It makes my life much simpler.
18) Get a part-time job (I know, I know — it’s just temporary).
Retailers are notorious for hiring folks just for the holidays. Think of stores in the mall, discount stores, and even toys stores.
Warehouses and call-centers are busy this time of year too. Think outside of the box and remember, it’s only temporary to help you afford Christmas and not go into debt!
19) Give a financial gift contribution to a 529 account.
Last year, I wrote an article for Cat Alford about great financial gifts you can give your children this holiday. Check it out here and tell Cat I said hello! Another big thing that’s gaining popularity this year is giving your child a stock gift card. Yep, that’s right. Walk right into the store to the gift card area. There you will find stocks for Facebook, Disney, Apple and more.
20) Avoid Buy Now, Pay later like your life depends on it!
Honey, when that interest kicks in you’ll be hating yourself. If you don’t pay off that balance before the promotional period ends on these types of deals, you’ll owe interest on the original plus any interest that you would have accrued during the promotional period. I just don’t deal with these offers at all.
21) Look for free entertainment and Groupon for holiday activities
Your entertainment bill during this time of year can easily spin out of control. A play here, a musical there, New Year’s parties, etc. Add in drinks, foods, and attire for the occasions and your budget can suffer a mighty blow.
Instead of paying, look for free activities. Some neighborhoods or churches have free plays and musicals during the holidays. If not, check out Groupon, your local Macaroni Kid, or town newspaper for free events.
22) Use shopping apps like Ibotta.
Ibotta has great rebates for things like candy, gift wrap, and all other kinds of holiday stuff. Before you purchase anything this holiday season, check to see if it’s listed on Ibotta. If the item is listed for the retailer, select it and scan your purchase once you’ve bought it. Sign up for Ibotta here.
23) Plan holiday travels ahead of time to score best deals. Churn those credit card rewards for air miles if you’re fancy.
Check out this post on how you can use Ibotta to save on travel too.
24) Donate time and goods to a charity.
Why? Because you won’t be spending money. Volunteering your time or decluttering your home for charity doesn’t involve swiping a credit card. Give and save!
25) Keep life simple during the holidays with simple and cheap meals the weeks leading up to the holidays.
I’m not great at creating meal plans so I’ll share an article or two that have some great meal plans that are simple and cheap for you.
- 23 Quick and Cheap Meals That Will Save You Time and Money This Holiday Season
- 23 Quick and Cheap Meals to Feed The Family for Under $6
- 22 Meatless Meals on a Budget (That You’ll Actually Enjoy!
26) Give practical gifts to kids and adults.
Instead of expensive Bath and Body Works, give your loved ones (especially struggling college students) a toiletries basket with things they would use every day. Put it in a basket and tie it off with a nice bow.
If you start ahead you can use coupons along with drugstore deals and get toiletries like toothpaste, toothbrushes, soaps, lotions and such at rock bottom prices or free.
27) Keep Track of Your Gifts
To help you out, I’ve created this free holiday gift tracker. Write down each person you’re buying gifts for and set your budget. This will help keep you sane this season. Grab your free copy by clicking this link.
Create Your Debt-Free Christmas Plan Now!
This could be considered 20+ ways to save at Christmas vs having a debt-free Christmas, but I think it’s important to point out that every little bit adds up. Once you begin spending and the money runs out, it’s easy to fall back on that credit card.
Relying on credit during Christmas time can put your finances in serious jeopardy. This doesn’t have to be the most expensive time of the year if you plan for your expenses and save ahead.
These are all easy and realistic things that you can actually do to achieve a debt-free Christmas this year. Call it savings, debt-free techniques or whatever you like — just implement some of them in your holiday spending plan and thank me later.
Anyone else got any good debt-free Christmas tips to share? Drop me a line in the comments!