christmas on a budget

Wondering how to do Christmas on a budget? 

I don’t know about you, but this time of year always gives me The Panic.

We had a fabulous long summer, but we blew the budget. Three weeks in California with a teenager makes for a very sorry looking bank balance come the autumn. Added to which, this is the time of year I renew my car and home insurance, pay my corporation tax and VAT. Oh, and I’m moving to a new house.

Excuse me while I sit in the corner and have a little cry.

How to Budget for Christmas

In a recent survey, 54% are want to do Christmas on a budget. So the first thing to realise is that LOTS of us are looking to cut the cost of Christmas.

With this in mind, I think the first step in creating a budget for Christmas is to understand your total available budget. I use a simple Excel spreadsheet to map out all my fixed, non-festive expenses. This covers things like mortgage, utilities, insurance, car expenses, and regular bills for food, TV, phone and Internet etc.

Knowing I was on a budget, I then looked at how many of these expenses I might be able to reduce. So start by looking at direct debits, and identify any you’ve set up but no longer need. Removing Flea from our monthly gym membership (she never goes) saves us £70 a month, while shopping around for home insurance saved another £300 a year.

Ways to Raise Extra Cash at Christmas

Every year, I look at ways to raise extra funds to put into my Christmas budget. There are a few ways I’ve tried:

  • My first step is to declutter and put aside things I might be able to sell. I’ve gone through both of our wardrobes, clearing out unwanted clothes or things that Flea has grown out of. Fellow Mums of teens will not be surprised to learn this pile also includes plenty of barely worn, expensive items that Flea has decided are TOO UNCOOL to consider wearing. I list clothes on Depop or eBay, and typically can sell on branded gear for a reasonable amount. I sometimes put things aside and try to sell at the right time – you’ll make more selling winter coats in October than swimsuits – save those for May!
  • Download apps like Music Magpie and Ziffit and you can scan books, CDs and video games. Each site will offer you a price for used books etc, and honestly check the price for each item on BOTH apps. As you go, sort your items into two piles, based on who offers you the best price. I raised £100 by selling two boxes of CDs, books and DVDs this year.
  • If you’re anything like us, you have a load of foreign currency lying around the house in drawers and at the bottom of suitcases. I took a bunch of US and Canadian dollars and Euros to the supermarket and swapped enough to pay for half of my Christmas food shop! Since I got “free” shopping, this makes the chocolate biscuits I added to the basket entirely justifiable, right?
  • With Christmas coming up, it’s also worth looking for ways to make days out and trips cheaper – the Family & Friends Railcard is a brilliant buy, saving you up to 60% on train tickets. Your Railcard also gets you 2 for 1 access to loads of family attractions around the UK.

christmas on a budget

How to Budget at Christmas: Top Tips

Now you’ve maximised your available spend what are some of the best ways to reduce the cost of Christmas?

  • Buy wholesale if you have a lot of people to buy for. I pay £29 a year for a Costco membership and it pays for itself at Christmas. Not only can I buy food in bulk, the weekly “special deals” that are available either in-store or online often include discounts on must-have items such as AirPods and Macbooks, but popular toys, Christmas decorations and party foods.
  • If you’re looking for a specific item and have found it online, do a Google image search. This works especially well for clothing. You often find the same photos of clothes used across multiple sites, and you can often find them cheaper
  • Always check for discount codes if you’re looking for a particular item – sometimes they may be shared on money-saving websites but you should also follow retailers on social media as you might get notice of specific sales.
  • It’s not a discount code, but it’s worth checking the Amazon website daily deals each morning to look for items that are on flash sale. It’s possible that items come up at up to 80% off in the run-up to Christmas.
  • Spread out your spending: Consider spreading out major purchases over time so you don’t overload yourself – a worthwhile exercise is to distinguish the ‘nice to have’ items from the ‘essentials’ and prioritise accordingly. Try to buy one gift each week or month in the run-up to Christmas.
  • When you are spending, make sure you’re getting something back in return. If you’re buying a holiday are you making sure you’re collecting the air miles? Is it worth shopping somewhere you’re rewarded just for spending what you would normally, whether it’s Nectar points or cashback through a site. Always Google before buying anything online to see if you can get this sort of cashback offer.
  • Did you know that if you take out car or home insurance through Sainsbury’s Bank, you could get double or even triple Nectar points in the run-up to Christmas? You can then redeem the points however you like, whether it’s money off your Christmas food shop, or cashing them in for presents at stores such as Argos.

Do you have any favourite tips on how to do Christmas on a budget? 


Sally is a full-time blogger and founder of the Tots100, Trips100, Foodies100 and HIBS100 communities, along with the MAD Blog Awards. She spends a bit too much time on the Internet. She's also a very happy Mum to Flea, the world's coolest ten year old.