5 Ways to Save Money this Christmas

by Jamie Simmerman · 18 comments

Even if you have a small holiday shopping list and a small family, you can still wind up paying out a ton of cash for holiday gifts. In a perfect world, everyone would get exactly what they were wishing for this Christmas, and the government would pick up the bill. However, in today’s economy the average consumer is looking for ways to cut back on expenses at every corner- including holiday shopping. Here are a few ideas to help you save your budget and still satisfy all those outstretched hands this Christmas.

How to Save Money this Christmas

  1. Gift Exchanges Rock. If you’re trying to purchase gifts for a large or extended family, one of the easiest ways to reduce the cost of holiday shopping is to start a gift exchange. Each member of the family draws a name from a hat and purchases one gift for that person only. You can set spending limits, include gag gifts, and even agree to still buy gifts for each child in the family if you so choose to help keep it fun for all involved.
  2. Forgo the Gifts. Instead of purchasing a new bottle of Old Spice for Uncle Greg this year (like you have for the past 15 years), try suggesting the entire family get together for a special event or a nice meal and forgo the gifts. This can cut back on your overall holiday spending and you will remember Aunt Judy getting shot in the bum with a paintball gun much longer than the fuzzy socks she would have given you if you hadn’t suggested a change this year.
  3. Share a Christmas. Instead of purchasing gifts for each other, get together with co-workers or your extended family and agree to do a public service project together for the holidays. Donate time at the local homeless shelter or soup kitchen, volunteer at your local animal shelter, or agree to do yard work and clean house for an elderly couple in your neighborhood. You can bake cookies and deliver them to residents of a nursing home who cannot visit with family over the holidays, clean out your closets to donate to the local clothing bank or Salvation Army, or go grocery shopping and donate the items to the food pantry. You can spend as little or as much as you want and enrich your holidays by knowing that you helped someone less fortunate while creating memories that will last a lifetime.
  4. Buy Gift Cards. I know that gift cards seem very impersonal, but your family may well appreciate a gift card for gas, groceries, or some essential item more so than an artistic dust-collecting figurine or some expensive smelly perfume they will never wear. Plus, many companies offer special discounts and bonuses for purchasing multiple gift cards around the holidays. You can save money and give a gift that will actually be used.
  5. Bake Your Gifts. Everyone loves a sweet treat at Christmas, so borrow your grandma’s amazing fudge recipe, bake up your favorite cookies and candies, and package them in pretty paper for holiday gifts this year. You can even plan baking parties with your friends, bake up a storm, and share the fruits of your labor to gain a wider variety of items to give away.

Saving money this holiday season might require starting new Christmas traditions and changing the way your family celebrates the holidays, but it is possible with a little flexibility, creativity, and a sense of adventure. Be willing to try new things and create memories instead of exchanging the same old tired gifts this Christmas and let us know what new memories you made that enriched your lives.

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{ read the comments below or add one }

  • Wendy says:

    Here in Spain, at least in my (Spanish) husband’s family, adults don’t get gifts, only children. However I’m not Spanish, and I like the idea of everyone having at least one gift to open! So I 1) regift, or 2) get something of the sort that people use up. This year, we got truffle infused olive oil for some, and nice hand lotion for others. Nothing cost more than €20. Chocolates or a nice wine would do as well. If we’ve taken a trip during the year, then we often bring back magnets (for adults) or t-shirts (for young people), and those become our Christmas gifts. I remember when we first started travelling abroad, I asked my brother and his wife if they collected anything, and they started a magnet collection on the spot, which was nice of them=)

    However the idea of thinking of some experience to do that everyone can share is really attractive. This year about half the people in our gathering were American, and half Spanish, and we made and decorated christmas cookies. The Americans hadn’t done it in forever, and the Spaniards had never done it, so we had fun.

    Another year, everyone brought one gift, similar to secret santa, but you didn’t know who your gift would be for. We numbered the gifts, and then drew numbers from a hat, and you took the gift with your number. No changes!

    I really like the idea of having a charity experience.

    People say “well, the children expect lots of things, it’s a tradition,” etc. Maybe you don’t want to make changes two weeks before the holidays – as was mentioned, many people buy gifts long before December, in preparation. But for next year, start talking up changes. Maybe you’ll be the instigator for a new tradition, that people (including children) will eventually like even more!

  • Jennifer says:

    I remember when banks had Christmas savings accounts. My mom, who was a single parent, did this every year when I was little. She bought everything with cash from that savings account. And she usually managed to get the top three items on my list. Do banks do this anymore?

  • Kevin says:

    Another strategy is to *make* money for the holidays. I go to the toy stores in October and buy up the Star Wars Lego sets on sale and sell them on eBay. If you are careful, you can double your money.

  • Dena D. Sprague says:

    I have been taking my daughter on my “treasure hunting” trips to goodwill, and other consignment/resale shops since she was about three years old.

    She is now a natural at looking at things in more than one way, retail being the last resort instead of the first, she also loves the prospect of getting something off of Freecycle with the same optimism every lotto player in the world

  • DawnRiley says:

    Hmm… these ideas are REALLY frugal. I do like baking, but I was thinking I’d see suggestions more along the lines of using FreePriceAlerts.com to scour the Internet and find the lowest prices for things on my Christmas shopping list for me or something of that nature. It’s hard to explain to the kids why they’re getting homemade gingerbread rather than the Iron Man toy.

  • Martin Bennet says:

    Well, Christmas is the time of huge expenses as we need presents for our family and friends and, therefore, we usually spend a lot of money for gifts. The tips of saving money mentioned by you can be really helpful. I think, I will try to follow them because I just have no opportunity to spend much money for Christmas presents. I have recently lost my job and can’t even imagine how I will manage to celebrate Christmas. Hopefully, I have some savings and I hope they will be enough. Anyway, I usually start to buy gifts a month earlier as it can also save some money as prices for everything are a bit lower. However, thank you for sharing.

  • Michael Douglas says:

    I like your ideas for saving money on gifts for Christmas. I’m also trying to do something similar with my family and friends. I think I’m going to create a coupon book for free services like babysitting, making dinner, movie night, and hand them out as gifts.

  • Jerry says:

    One way we saved at Christmas was selling items on ebay and using the proceeds to buy gifts for the family. It was insurance for our budget and we never had to dip into our other money.

  • Elton John says:

    Gift Exchange during Christmas is the best way to saves money. You spend some money and get something in return. it is like buying something for the holidays for yourself. One good way is also……..not celebrate Christmas at all. LOL. Just joking.

  • Blue Spyder says:

    Well I wanted to take the family on a cruise, but to hell with that idea

  • Janet says:

    “In a perfect world, everyone would get exactly what they were wishing for this Christmas, and the government would pick up the bill.”

    In a perfect world, there would be such a thing as a free lunch – and free gifts – but in reality, nothing is free. The government would have to raise our taxes in order to dole out more “free” things.

    Otherwise, good holiday tips.

  • Sachin says:

    seems good ways to save money…will try couple of these this time and see what works for me..thanks..

  • Christine says:

    Gift cards are a good idea, just make sure you know where your intended recipient shops. I have several gift cards still unused from last Christmas

  • Andrea says:

    I like your ideas for saving money on gifts for Christmas. I’m also trying to do something similar with my family and friends. I think I’m going to create a coupon book for free services like babysitting, making dinner, movie night, and hand them out as gifts.

  • Money for Regular People says:

    Finding ways to save money on Christmas is a great idea, but the reality is that the holidays cost money. So how do you manage it? I believe at the most basic level you set a budget of what you can afford (e.g. $500) and stick to it. If you can’t realistically get everyone what you think is a reasonable gift then cutting down the overall list by doing a gift exchange is indeed a great idea (it works especially well for big families). I like baking/cooking as another backup.

    So where does the $500, $700, $1,000, etc. come from that you want to spend during the holidays? If you figure that out in *January* rather than December and save each month then Christmas purchases can be a joy rather than a stress.

  • Ben Stiller says:

    Exchanging gifts during Christmas had become a family tradition thus there is no way this will be omitted just to save some bucks. A lot of family members are expecting this and may have actually done their shopping even before the holiday season started. And that is one way of spending less on gifts by doing your shopping off season.

  • Paul Michael says:

    Very good ideas of saving money with Christmas presents, we have been trying these ideas, not all of them, last year and our savings were almost a half of what we spent the year before, everybody should try

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