How to Handle Christmas Without Going into Debt

by mzumtaylor on December 7, 2010

If you’re anything like me, you love the idea of giving gifts to people, but you don’t always have the funds to give them things that seem really good or meaningful.

First things first, there is a common fallacy in the US that “more expensive” equals “more meaningful.” This is simply not true. Let me say that again: more expensive does NOT equal more meaningful.

One of the best gifts I ever received was a page ripped out of a coloring book by my littlest sister and given to me the day before I went to Japan for nine months. It was a carefully colored picture of a frog, and it said, “I love my sister!” I hung it on my wall the entire time I was there, and I still have it hanging next to my desk. It always makes me smile. Now that’s a good gift.

Most people, when faced with wanting to buy Christmas presents, and not having much (or any) extra money to do so, whip out the credit card and promise themselves that they’ll pay it off in January when things slow down. That road leads to trouble if you’re not very, very careful. Instead, let me recommend two other options.

Two Ways to Handle Christmas Without Going Into Debt

Way #1: Figure out how much you want to spend at the start of the year, and save a little each month toward that goal.

(I also write about this way in my eBook) You figure out at the start of the year (January, or even the end of December, when the numbers are fresh in your head) just how much you want to spend on the important people in your life. Say $30 for each parent and $20 for your siblings, and $10 for your close friends. (Or maybe $20 for your close friends, and $10 for your siblings, if you don’t like your siblings as much. ^_^)

If you have two parents, two siblings, and ten close friends, that comes to $200. Not an unreasonable amount of money to spend on people you love, but not always readily available in November and December when you’re thinking about finding gifts.

So, knowing how much you want to spend, having that money available is as simple as putting aside some money a month toward your Christmas fund. If you’re starting in January, you have roughly ten months to save up that $200, which means you’ve got to find $20 a month.

Even at the depths of my poverty, when my now-husband and I were living paycheck to paycheck and only making minimum wage, we still could have found $10 each paycheck ($20 a month) to put aside in a jar for Christmas.

Way #2: Okay, but what if it’s December 7th and I haven’t saved a dime?

This is a very common scenario, and one that I’ve found myself in more than once. It’s still possible to do Christmas without going into debt when you’ve not managed to plan ahead.

The first step is to figure out how much money you do have to spend. If the amount is $0, that’s okay. Knowing that is just as important as knowing you could probably spend $40 or $100.

If you have some money to spend…

  1. Check out online book stores, like Amazon.com and Better World Books. Both stores link to independent sellers who sell new and used books for cheaper prices. There have been years where I’ve gotten very good quality items for not much more than the cost of shipping.

    Amazon probably also does DVDs, although I’ve never used them for that.

    Remember: If your budget is tight, don’t shell out for faster shipping. If your present is going to arrive late, so be it. Next year, you’ll plan better. As always, it’s the thought that counts.

  2. Check out used book stores in your area. There is a great used book store near me that not only sells used books, but also music and movies. There might be something like that near you, and it’s always worth checking out. I got Meet the Robinsons for my sister’s birthday for $4, which is not a bad price at all.
  3. A Picture Is Worth a Thousand Words. With the advent of smartphones and facebook, most people have a handful of pretty good pictures of themselves and their friends. Why not take one of those pictures and get it printed to give to family members? Last I checked, printing pictures at Walgreens or Target still only cost $0.15 or $0.20. Even if you have to print ten of them, that’s only going to run you about $2.

    Even better than just a picture, which you can send in a nice card if that’s your wont, is a framed picture. You can pick up frames at your local thrift store for $2 or $3 a piece, usually, although it takes a bit of patience to look through them all. You can also get pretty inexpensive picture frames at Target or even Hobby Lobby.

    Framed pictures are an especially good gift for parents and grandparents, especially if you live far away.

  4. The Simple Dollar posted a hand-made gift series all through November with some really killer ideas of simple things to make for the people you love. (My favorites are #6, #8, and #9.)
  5. Send letters to your family and friends. If you’re really pressed for cash, but you’ve got a little bit to spend, write letters to the people who love and care about, even if they live just down the street. In this day of instant communication, getting a letter in the mail is just like getting a gift, if only because it’s become so rare. A stamp still costs $0.42, which is why I suggest this option under “If you have a little money…” but I guarantee you that the people you send letters to will think it’s pretty great that you thinking of them enough to take the time to do so.

If you have no money to spend…

  1. Make gifts for your friends and family. If you like to draw or paint and have supplies on hand, create pictures for the people you love. If you like to knit or sew and have supplies on hand, make them something small and useful, like a scarf, or a skirt, or a bag. If you like to bake and you have supplies on hand, bake little breads or cakes or cookies and give those to your family.
  2. If you’re not creative, ask a friend who is to help you.

    Even if you’re not someone who makes things, chances are good that you know someone who is. And chances are also good that if they’ve been doing their creative thing for a while, most of their loved ones already have whatever they make. Say you have a friend who knits, and you’d like to give your family and friends hand-knit hats for Christmas. It’s likely that all of your friend’s family already has all the hats and scarves they can use because giving things to family is one of the first things a knitter does after she gets good.

    Just remember to be respectful of your friend’s time, however, and that “No” is a perfectly acceptable response.

      IMPORTANT: Always, always, always offer to compensate people for their time, even your friends. The compensation doesn’t have to be monetary; you could offer a trade.

      In the past, if someone has done something for me, and I haven’t had any money, I’ve made up little voucher slips that show what I’ve promised to do for them in return. If I have even a small amount of cash, I often offer that. I say, “I know your time is valuable and I can’t offer you much, but I could give you $5?” Most people, when offered compensation for something they like to do anyway, will turn it down and feel generous and benevolent having done so. If they do accept your offer, however, don’t hesitate to make good on it. I always try to have cash in hand when asking someone to do something, or have the voucher slips ready.

Just a Little Creativity is All it Takes

It’s possible to give thoughtful, meaningful gifts this Christmas without going into debt, so put away that credit card and sit down and really think about the people you love. What do they like? What do they need? What would they appreciate?

If you can answer those three questions, you should be able to find a great gift for everyone on your list. And if you can’t think of something special to give someone on your list, don’t give them anything. If you still want to show them you are thinking of them, write them a letter or send them a card, but don’t buy a gift for them that won’t mean very much to them and might destroy your budget. It’s not worth it. If they’re really a friend, they’ll understand.

Best of luck, and happy holidays!

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