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Budget For Gifts

When developing a monthly spending plan and trying to nail down that budget, many people often forget to list “gifts” as a line item in their budget. The reality is that, come December, many people are going to spend–and overspend–because they didn’t take the previous twelve months planning for Christmas gifts. The result? Over extending ourselves during the holiday season means that we will spend the next twelve months trying to climb out of the credit card debt Christmas put us in. And right when we’re about to get that zero balance, Christmas strikes again. (Not to mention the price of all the birthdays, anniversaries, going aways, housewarmings, baby showers, weddings, promotions, holidays and other events that happen in between each Christmas season.)

Lather. Rinse. Repeat.

If you do set up a special savings account for gifts, chances are you will actually end up spending less money on the gifts themselves because you’ll notice how much things really do cost. By spending cash that you have worked to set aside, the purchase becomes a more deliberate and intentional experience. Credit cards have made money an illusion. Our plastic friends make nearly everything attainable even as it keeps us financially enslaved to this insidious cycle of debt.

By limiting your financial resources to the cash that you have saved, gift-giving becomes increasingly joyous. Sure, you might have to be a little more creative at finding that perfect gift because of your budgetary limitations. But, at the end of the day, people really do enjoy the sentiment behind the gift, rather than the price attached to the gift.

By budgeting out the money you will spend on buying gifts, you are adding another element of control to the financial chaos of your life. Make it a line-item in your monthly spending plan, and eliminate the chaos today.