How will you survive financially during the holidays? By following the 5 C’s!

This week I had the opportunity to lead a webinar titled “How to Win During the Holiday Spending Season.” While I provided the audience with specific tips on budgeting to avoid debt, I also threw in some bonus philosophy suggesting that this time of year has not always been about who spends the most money on the best presents. As an early holiday gift to my readers, I have compiled a taste of my webinar content with five tips, which I am calling the “5 C’s”, that can help you keep your sanity and some money in your pocket between now and the new year.

CONTENTMENT

Aside from Christmas, there are other significant religious and regional holidays such as Hannukah, Kwanzaa, Chinese New Year, etc. Christmas is a big deal in my family. While I enjoy watching Home Alone and scanning for sales on Black Friday as much as the next person, there is also a spiritual element that I personally hold as significant. It occasionally makes me sad that the true reason Christmas exists is so often ignored because of Santa Claus, Jingle Bells, lights and decorations, the endless food/parties, and of course, gifts.

Competition, greed, and general insanity have marked their territory. If we take a step back and think about it, does it really matter if we get the last flat screen at Best Buy, or if we buy our kid everything they want (this is impossible and will not do the child any favors) or maybe even finance a luxury car as a worthy enough gift?

I believe that if we can all take a moment to reflect on what the true purpose of the holiday is that we are trying to celebrate with the family and friends we love, we will reach a higher level of contentment without having to break the bank.

Over time, many traditions have emerged during the holidays. Some traditions have evolved to include massive amounts of competition, greed, and insanity. Since this is not you of course, it is okay to keep a seasonal budget and stay true to your holiday purpose.

COMMUNICATION

A secret to making holiday or any budgeting plan work is communication. Whether this is with a spouse, extended family, or what your unique situation entails, if a team is involved then getting your money right during this most wonderfully expensive time of the year is only going to work when everyone is on the same page.

If you are married or in a long-term relationship, you may have combined finances. You and your partner will be best served to work as the dynamic team you strive to be and formulate a holiday spending plan. Not only will this keep you from borrowing money or spending too much, but the added layer of communication will also serve as a mechanism to strengthen your relationship.

If you have children, especially younger ones, it is okay to let them know that you will work to make sure they have a wonderful holiday, but as the adult who controls the finances you also have the right to say no to unrealistic asks or gifts that you simply can’t afford this year. Most times, the attention and respect you can provide for your children will make up for any amount of money that could be spent on them.

You certainly have the power to change or say no to traditions that may exist among your extended family. If we are honest, friends and family are made of different circles, similar to a dartboard. You have your casual or outer layers, your middle layers which include those with whom you share closer relationships, and finally the inner circle. Each level will have different parameters and expectations for spending. But you ALWAYS have the right to set or change rules based on your needs or financial situation.

With a spouse, team up on a holiday budget to keep you financially on track and strengthen your relationship. With kids, tell them what the holidays will look like, that they may not get every gift on the list, and you may even have to use that magical word “no”. With extended family, send third-cousin Tommy a family selfie with a thoughtful note rather than gourmet fruitcake he won’t eat!

CHOICES

If you want to be responsible during this season and get through the spending madness without getting sucked in by credit cards, map out from now until the end of the holiday how much income your family should bring home. Subtract your vital expenses that I call the “four pillars” (shelter, food, utilities, transportation), and any other bills that must be paid (if you have debt payments, this is a big reason you are stressed right now). What is left over can be your holiday budget, it is that simple!

No matter how many pennies you can squeeze into this budget, and how many gifts you are able to give, you will never be able to do it all. Think for a second about all the purchases that come this time of year…it is unbelievable! Gifts, decorations, more gifts, ugly sweaters for all the parties, travel, more gifts, the never-ending food and cookies, it never ends. You could never check off all those boxes, so guess what? Don’t check off all the boxes! Tis’ the season to prioritize what is closest to your heart and your family’s interests. Cut yourself some slack for missing out on a few things.

At my workplace there has been a long-running tradition of Secret Santa. While I enjoyed participating in this spectacle in prior years, I opted out for 2023. Am I going to win the award for most popular teammate? No, but everyone respects my decision and guess what? I am at work to do work, not buy gifts! So, it is going to be okay, and everyone else who wants to participate still can! I am not saying you lose with money if you do Secret Santa, I am just illustrating an example of a choice I made so I can stay within my holiday budget. People who win with money often make tough choices.

There are countless holiday norms that will pressure you into holiday spending. You cannot do it all. Now that the truth has set you free, give yourself grace to prioritize based on YOUR needs!

CUTS

If you are on board with making a budget and not borrowing money to get through the 2023 holidays and beyond, there are several cuts you could look at making to make your holiday spending goals attainable.

-Restaurants: Sorry, but restaurants (this includes Door Dash and takeout) are a want and not a need. You need to eat; you do not need a waiter or driver to bring the food to you. Restaurant food is much more expensive than eating at home and often less healthy. Meal Planning is a cost-effective method to only buy the groceries you need, prepare your own meals, and trim your budget (and waistline).

-Subscriptions: Let’s go through the list, shall we? Cable television is not a need. Netflix, Hulu and Disney Plus are not three of the four pillars. Do you like to exercise? Me too! But I spend zero dollars for a gym. I go for morning runs, lift dumbbells in my bedroom, and watch any of the millions of workout videos for free that I want on YouTube.

-Dry Cleaning: I often share that back when I was $50,000 in debt and trying to escape, this was the first thing I cut. I have become an expert at paying attention to labels so that I can hang-dry delicate items, getting the rest of the clothes out of the dryer promptly so they do not wrinkle, and (gasp!) using an iron when I forget.

-Studio Photography: One of the biggest money grabs during the holiday season. Seriously, just find a spot like the mall or wherever there is a beautifully decorated tree, ask someone to take a picture on your 48-megapixel titanium-dipped iPhone 15, custom design your own cards on Amazon photos or Walgreens, and save hundreds. Earlier I talked about the layers of in-house vs. extended family…the personal choice my wife and I have made is we do actual presents for only our kids and our parents. Everyone else gets a nice Walgreens family photo with a personalized note. We have never gotten a complaint, and if one happened behind our back, we could not hear it!

-Holiday Vacation: Reconsider travel plans if it could be a challenge to make it through the holiday season. Not to be unkind or judgmental, but vacations are where people who have money go to escape work. People who don't have enough money should be seeking ways to get more work. Vacations usually cost thousands of dollars. If money is tight this year, invite your loved ones to come visit you.

Try cutting one or more non-essential needs from your budget so that you can give more generously this season, with less stress attached. Who knows? You may decide that some things you cut temporarily are not vital to your everyday life and keep those items out of your budget more often!

CHARITY

If it makes you upset thinking you are going to have to press your own shirts or skip that winter cruise to Turks & Caicos, a good way to snap out of that mindset is to think about who may have it even worse. According to statistics from the Annie E. Casey Foundation, roughly one in every six children in the United States lives in poverty. This is not meant to judge or guilt-trip anyone, but maybe we can all scale back a tiny bit on the amazing Christmas we plan to give our own children, hold back just one of their gifts, and instead donate one to Toys for Tots or a similar worthy cause.

Once I got control of my money, it has been a priority for our family to increase the amount in our monthly budget for church donations and additional giving. While it is precious to see the happiness on my own kids’ faces when I hit a home run on a gift they really wanted, it is a completely different and much stronger feeling of joy when I know my generosity is helping another person, especially a child, improve their situation.

READY…SET…GO!

If you are ready to win, pledge to prioritize and limit spending to what you can afford to pay cash for, with no loans or credit cards! Once you set the budget, stick to it and you will experience a giant sense of relief and pride. Everyone has an opinion, and some may disagree with how you’ve decided to celebrate during the holiday season. Who cares?? Ignore the noise and follow what your heart and mind tell you are the best ways to spend YOUR hard-earned money this winter!