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8 Steps to a Cash Christmas

Recent studies have shown that the average American will add $986 of debt to their household because of the holidays. While that may seem like a manageable amount for some, this debt is completely unnecessary. Having a cash Christmas can help keep your finances in order, keep your stress levels down, and also keep you from overspending.

This is a guest post from our regular, talented writer, Kim Studdard.

8 Steps to a Cash Christmas

These 8 steps will help you buckle down and keep you on track to have a Christmas with no debt.

Set Your Budget

If you plan on having a cash Christmas, the first thing you need to do is set a limit that you don’t want to go over. It can be $200, $500, or even $2,000. The important thing is knowing how much money you need to save, and how much money you are willing to spend without using credit cards.

Make A Wish List

Now that you’ve set your budget, it is time to make your wish list! Whether it’s just you and your significant other, or if you have a family, have everyone sit down and write down the items that they want for Christmas.

If you have little ones, consider their needs first. Do they need clothing, shoes, or any bath items? Those should be your priority. From there you can add items like toys, books, and things that are wants.  

To help you manage the items you buy for family, you can always split your lists into three categories; expensive gifts, moderately priced gifts, and inexpensive/homemade items. For my family, we choose one expensive gift (anything over $50), two moderate gifts, and three to four inexpensive and homemade gifts. That way, no one misses out, and no one is receiving more or less than anyone else.

Start Saving/Automate Your Savings

Now that you have your budget and lists in order, it’s time to start saving. The best and easiest way I have been able to save for a cash Christmas is having my money automatically taken out of my paychecks (I use SmartyPig, but you can use anything you want). Even now with my own business, I make sure to take out a set amount of money for holiday spending and throw it into a separate savings account.

To make sure that you know how much you need to save, take your budget and divide it by the amount of weeks, months, or paychecks you have to save. So if you want to budget $1,000 for Christmas and have 10 weeks to save for it, then you would need to save $100 a week.

  • Bonus Tip: Start saving early! I start saving for Christmas as soon as the New Year starts. That way, if there is ever a time where I CAN’T save, I still have a padding for the holidays. Saving earlier also helps eliminate some of the stress that the holidays can bring.

money saving ideasEarn Extra Cash

So let’s say you haven’t been saving for Christmas, and you aren’t sure if you can afford the gifts that you and your family need or want. If you think you won’t hit your savings budget, it’s time to start making extra money!

A few ways to earn extra money are to get a part time job (many places hire holiday help), take surveys for gift cards, or even offer some of your talents as services. Even if you just babysit a few days a week, you could easily add extra money to your cash Christmas fund. If you decide to complete tasks for gift cards, make sure you choose a card to a store that you can shop at for multiple gifts vs. a store that you can only pick up specific items.

Cut the Unnecessary Items

Who still buys a Christmas tree every year? What about Christmas cards? If you do, you may be spending a lot more money than you need to. Having a cash Christmas doesn’t just mean paying for gifts in cash, it means celebrating Christmas as a whole without getting into debt.

If your budget is on the lower side, cutting out unnecessary spending can add so much money back into the spending pool. It is up to you to decide what is a necessity, but to keep things super simple, it is smart to cut out anything that doesn’t have to do with gifts and Christmas dinner.

Consider Alternatives

Do you have to buy an iPad if another tablet will work just as well? Does your spouse really need another video game disc, or can you offer them the game online to save a few bucks? You shouldn’t have to get into debt to be able to buy gifts for your family.

If you can get an alternative that is equivalent to the gift asked for, why not save yourself some money? If you aren’t sure about the brand or type of gift that is wanted, asking is always your best bet.

Check Out Sales

Once you have your budget, savings, and wish lists in check, it’s time to start looking for the gifts that you will buy for your cash Christmas! As many of you may know, Black Friday and Cyber Monday are great days to save money, but stores will have other sales around Christmas time.

If you save earlier in the year, you could start buying Christmas gifts AFTER Christmas is over the year before. If not, that’s okay, but you should still keep an eye on sales. Even if you don’t like receiving a lot of emails, it is a good idea to sign up for a store’s email list (if you shop there that is), so you are the first to know when they are holding sales.

Purchase Gifts

Once you’ve completed the steps above, you are ready to purchase your gifts in cash! Remember to keep your budget and cash flow in mind, and you are well on your way to having a cash Christmas. It really is that easy!

Shopping for Christmas gifts on an all cash budget can seem foreign and a little out of the ordinary, but it really is a freeing experience. You don’t have to get into debt buying gifts for your loved ones, you just have to get a little creative!

Use these 8 steps to a cash Christmas and never go into debt for Christmas again!

Budget Money


My name is Derek, and I have my Bachelors Degree in Finance from Grand Valley State University. After graduation, I was not able to find a job that fully utilized my degree, but I still had a passion for Finance! So, I decided to focus my passion in the stock market. I studied Cash Flows, Balance Sheets, and Income Statements, put some money into the market and saw a good return on my investment. As satisfying as this was, I still felt that something was missing. I have a passion for Finance, but I also have a passion for people. If you have a willingness to learn, I will continue to teach.


  1. Another great article, Derek! Kim Studdard’s shared some awesome ideas, for sure.

    I especially like this partial comment at the beginning, “. . . to have a Christmas with no debt.”

    What a goal to have. I’m pleased to say that we haven’t accumulated Christmas debt in years. Everything is paid for up front.

    Start saving and automate your Christmas saving is a great idea. We haven’t truly done that, but I now have a rewards credit card, that’s paid off monthly via Debitize, and I’m “ear marking” the rewards for Christmas spending.

    This way most of it won’t have to come out of our budget. I figured, let the credit card pay for Christmas, but not in the usual manner.

    Gonna pass this one along, as it’s awesome info.

    All the best from Texas!

    • Glad you loved it Shin! It’s a great article for this year AND for thinking about how to do things differently next year. Sounds like it even changed your course of action a bit. 🙂

  2. Every January my husband and I decide what we will spend on Christmas and each month 1/12th gets put into savings. We do use credit cards for online purchases and because it is simply easier to track the amount spent, but the money is ready when the statement arrives and is paid in full when it arrives. It is not difficult to do if you just exercise a little discipline. Full disclosure, I sometimes go over the budget by maybe a hundred dollars or so but I take care of that with my personal cash stash.

    • Sounds like you’ve definitely got a plan each year, Kathy. Good for you!! And thanks for sharing!

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