Christmas on a Budget: 16 Money-Saving Hacks to Try

This article may contain affiliate links. Read the full disclosure.

Last Updated on September 30, 2023 by Rebecca Lake

Planning Christmas on a budget may be a necessity if cash is tight. Coming up with fun ideas for a frugal Christmas can make it easier to enjoy the holiday season.

Thinking that you can’t afford the holidays is not a good feeling. It’s hard to have a magical Christmas when you’re constantly stressing about money, and you might feel pressure to spend just because everyone else is.

If you’re thinking how can I survive Christmas with no money you’re in the right place. Today, we’ll walk you through some tips on how to plan Christmas on a budget, without sacrificing fun.

What Should My Budget Be for Christmas?

budgeting for christmas
How to Plan Christmas on a Budget

What is a good Christmas budget? There’s no single answer and here’s why.

The ideal Christmas budget is the amount of money that you can realistically afford. It should also be an amount that you feel comfortable spending.

If you need a specific number for how much to spend on the holidays, a suggested Christmas budget is no more than 1.5% of your gross income.

For example, if you have a gross income of $50,000 annually, your Christmas budget would be $750. If your gross income is $100,000 a year, you’d double that to $1,500.

But what if you can’t afford to budget 1.5% of your income for Christmas?

You find ways to afford Christmas on a budget instead, which can include getting free money for Christmas!

frugal christmas on a budget
Frugal Christmas Tips

16 Money-Saving Ideas for Christmas on a Budget

Before we dive into the tips for planning Christmas on a budget, let me just say that these are all tips I’ve used over the years to save money.

As a married mom and now a single mom, keeping holiday spending in check has always been a priority for me. So if you’re wondering whether these money-saving tips for the holidays work, I can tell you absolutely yes. I’ve tried them all!

You can pick a few things off this list to try for planning a frugal Christmas or all of them. It’s up to you.

But I guarantee there’s at least one thing here that can help you save money at the holidays.

1. Set your priorities

Planning a frugal Christmas on a budget starts with setting priorities for how you’re going to spend your money and time.

So ask yourself this: What’s really important to you at Christmas?

If you want to have a frugal holiday season, then spending money is not at the top of your priority list. Or it shouldn’t be anyway.

Instead, your priorities might look more like this:

  • Spend quality time with my kids
  • Reach out to friends and family we haven’t seen in a while
  • Make sure the people we care about know we’re thinking of them
  • Create some lasting memories as a family

Those are all things that don’t require you to spend money at all.

As you’re thinking about your plans for Christmas on a budget, make a mental note of what’s most important to you.

2. Start planning early

woman wrapping christmas gifts
Plan a Fun Christmas on a Budget

The early bird gets the worm, right?

And the best way to ensure that you’ll blow your Christmas budget is to wait until the last minute to get started with planning.

Starting a Christmas savings account at the beginning of the year, on the other hand, can help you avoid coming up short once the holidays roll around. You can open a high-yield savings account and contribute a little bit of money to it each month, starting in January.


Looking for a new financial best friend?

The Dave app makes savings, spending, and earning easier!

Dave is a personal finance app that’s designed for people who want to simplify finance. You can budget, spend, and grow your savings all in one place while earning a competitive interest rate on your money. Dave also makes it easy to get up to a $500 cash advance in minutes, with no interest or fees!

How much money should you save for Christmas?

A typical holiday budget is around $1,000. So if you have four people in your family, you might spend $250 per person.

But that $1,000 may not go far if you have to buy for kids, parents, siblings, friends, coworkers, teachers, etc.

Figuring out how much you personally should save all ties into the next step in planning a frugal Christmas: making a holiday budget.

3. Set your budget and be realistic about what you can afford

We can’t talk about planning Christmas on a budget without actually making a holiday budget, right?

Here’s a quick guide to making a Christmas budget.

  • Decide what expenses you must include
  • Choose one or two nice-to-haves that you could add in if you have money left over
  • Assign a dollar amount to each expense category in your budget
  • Break that down and assign a dollar amount to each expense

One thing to know about making a Christmas budget when you’re broke is that it has to be realistic.

Otherwise, you’ll just get frustrated if you end up overspending.

So take a good look at your savings and regular monthly budget to figure out how much you can earmark for the holidays. Then use that number to plan out your Christmas spending.

4. Avoid going overboard on gifts

christmas gifts
Frugal Christmas Planning

Who doesn’t like getting gifts?

I actually really like giving them. It’s fun to see someone enjoy something that I took time to pick out for them.

But when you’re doing Christmas on a budget, you may not have a lot to shell out for gifts.

How much do you spend on each person at Christmas?

Again, the answer is different for everyone. And this is why it helps to have your Christmas budget planned out before you shop.

Because you’re probably not going to spend the exact same amount on every person.

It wouldn’t make sense to spend the same on a gift for your next-door neighbor or your kids’ teacher as you would for your kids.

So go back to your budget and look at the total amount you can spend on Christmas gifts. Then compare that to the number of people you plan to buy for.

Use that as a guide to come up with a number you can and want to spend on each person.

5. Shop secondhand for gifts

Regifting can make you seem like a cheapskate, I know. But hey, you’re planning Christmas on a budget, right?

So you’ve got to find ways to save money on gifts where you can.

If you don’t have anything to regift, consider buying things secondhand instead.

Consignment stores, thrift shops, flea markets, and yard sales can all turn up things that you could purchase as Christmas gifts.

You can also use Facebook and apps to shop for secondhand bargains. Decluttr, for example, is a great place to find deals on used DVDs, video games and consoles.

And you can also sell your stuff on Decluttr if you need an easy way to make money for the holidays!

6. Make gifts instead of buying them

making christmas gifts and crafts
Save Money on Christmas Gifts

Homemade holiday gifts can be a money-saver if you’re planning a frugal Christmas. Plus, it’s a way to create one-of-a-kind gifts for the people you care about.

If you’ve got a Cricut machine, for example, you could make signs, decals, cards, and other cute papercraft. Or you might try making some handmade soaps or candles for the people on your list.

Making gifts instead of buying them can also be a fun family project. Here’s a list of 40+ fun holiday gifts kids can create with their own two hands!

7. Consider a gift exchange to cut down on spending

Gift exchanges like White Elephant or Secret Santa can inject a little fun into the holiday season. And they can save you money since you’re only buying one gift instead of a bunch of them.

With this option, everyone puts their name in and draws a different name out. You only buy a gift for the person whose name you draw.

That can drastically cut down on the number of gifts you need to buy, which can help you save big when planning Christmas on a budget.

If you want to organize a holiday gift exchange with friends or family this year, here are 29 different ideas you can try!

8. Get cash back when you shop

woman christmas shopping online
Save Money on Christmas

If you’re shopping for the holidays and you’re working with a tight Christmas budget it only makes sense to find ways to save money

And there’s a super simple way to do it: using cashback apps to shop!

Cashback apps pay you a percentage back of what you spend. It’s almost like you’re being paid to shop, how great is that?

Rakuten is hands-down my favorite cashback app. With Rakuten, you can shop online or in stores and earn up to 40% cashback at partner retailers.

Plus, you can earn a $10 introductory welcome bonus and up to $30 in bonus cash each time your refer friends and family to Rakuten. I’ve made close to $1,500 with the app and it’s one of the easiest ways to make money for Christmas.


Want to Get Cash Back When You Shop?

Making extra money is easy with Rakuten!

Rakuten is a free app and browser extension that helps you find coupons and discounts when you shop online or in stores. You can earn up to 40% cashback when you shop at hundreds of partner retailers, plus get a $10 sign-up bonus and up to $30 in bonus cash for each person you refer!

If you’re looking for some other apps that you can use to earn cash back, be sure to check out these options as well:

9. Take advantage of dollar store finds

I love the dollar store for picking up certain items on the cheap.

If you have a Dollar Tree or another dollar store nearby, it’s your best friend for frugal Christmas shopping.

Some of the best things to buy at the Dollar Tree for the holidays include:

  • Wrapping paper
  • Boxes and bags
  • Ribbons and bows
  • Tape and scissors
  • Holiday cards and stickers
  • Stocking stuffer items
  • Holiday placemats
  • Holiday decor

Do you know what’s even better?

You don’t even have to go to a Dollar Tree to get those things. Instead, you can buy them online and have them shipped!

It saves you time and money during the holidays, which is a win-win.

christmas coffee mugs
Frugal Christmas Hacks

10. Avoid credit cards if you can

holiday shopping debt
Debt-Free Christmas on a Budget

Credit cards are convenient for holiday shopping. But if you’re not keeping track of them or you don’t have a plan to pay them off at the end of the month you could wind up with a pile of holiday debt.

So here’s a simple rule: don’t use credit cards during the holidays if you can avoid it.

Especially watch out for those retail store cards. They may offer a fat discount to get you to sign up but the interest rates on those things can be crazy.

If you’re planning to use credit cards to pay for Christmas on a budget, only spend what you can pay off once the statement comes in.

Otherwise, the interest charges could make all your holiday shopping more expensive.

11. Don’t pay for shipping

Shipping charges can increase your holiday spending budget and they’re a headache you don’t need when planning a frugal Christmas.

If you’re shopping online, stick with stores that offer free shipping for the holidays. And watch out for the ones that require a minimum order to ship for free.

That’s an easy way to end up spending more than you planned just to get shipping free.

And here’s my best tip: sign up for Amazon Prime to get free two-day shipping on most items.

I love Amazon Prime and the annual fee is well worth it to get the things I need shipped free. Plus, with Amazon Prime streaming, you’ll have an excuse to ditch cable and save money every month.

If you don’t have Amazon Prime yet, click here to sign up for a free 30-day trial!

12. Plan a potluck holiday dinner

christmas dinner
Christmas Money Saving Tips

Holiday dinners are a great way to get together with the people you care about. But buying all that food can get expensive.

So instead of planning to host the holiday dinner this year, suggest a potluck instead.

This way, you’re only responsible for bringing one dish instead of spending tons of money on groceries to make everything.

Here are 121 holiday recipes to try that can save you time and money!

13. Look for cheap or free holiday fun

You want to do fun stuff during the holidays, right? I mean, making memories with your kids is a big part of what Christmas is all about.

But does that mean you need to go broke trying to do Disney at Christmas? Or go to every single holiday event?

Heck, no!

There are plenty of ways to have fun as a family at Christmas without spending a lot of (or any) money.

For example, you could:

  • Drive around looking at Christmas lights
  • Roast marshmallows in the backyard
  • Pick a different Christmas movie to watch together each night
  • Read holiday-themed books together (my kids and I do this every year!)
  • Do some random acts of kindness for people who could use a pick me up at the holidays

I could go on and on but you get the idea. If you need some other ways to have fun as a family at Christmas, take a peek at this fun Christmas bucket list!

14. Skip the extras

planning a christmas budget
Budgeting for Christmas

In my experience, it’s not the big expenses that will blow your holiday budget. It’s always the little things that get you.

Things like holiday cards, for example.

I know some people spend hundreds of bucks on these things. But that’s just not me so we don’t send them out.

And if you want to save money on the holidays this year, you might skip them too and send a holiday email instead.

Aside from holiday cards, there are other small things you might be able to skip to have a frugal Christmas.

For example, you might be able to say no to spending money on:

  • New holiday outfits (I mean really, do you need another ugly Christmas sweater?)
  • Attending holiday parties
  • Fancy wrapping paper (if you have kids, they won’t know the difference between the good stuff and the Dollar Tree kind)
  • Expensive decorations
  • Stocking stuffers your kids will just forget about in five minutes anyway

If you don’t want to do away with all the extras this year, try getting rid of just one or two.

Even small things you can cut out can make a huge difference when it comes to sticking to your frugal Christmas budget.

15. Make extra money for the holidays

It wouldn’t be a normal post if I didn’t put in a word for making extra money.

Side hustles, and especially holiday side hustles, are some of my favorite things. Because making more money can make a tight Christmas budget easier to manage.

The great thing about starting a side hustle for the holidays is that you can make the money you need to pay for Christmas and do it fairly quickly.

And if your side hustle is a success, you could keep it going to generate extra income long after the holidays end!

If you need some inspiration for holiday side hustles to start, here are some of my favorite ways to make extra money:

You could also try selling things you don’t need for cash. Some of the best things to sell include jewelry, electronics, gaming consoles, clothes, and sports equipment.

If you’re looking for some ideas on where to sell your stuff, you could try Facebook Marketplace or local bargain groups. Pawn shops can also buy your valuable items for cash.

16. Get free gift cards to shop

Gift cards make great gifts and you can also use them to pay for holiday shopping. The best gift cards to use for Christmas purchases are ones that you don’t have to pay for.

How do you get free gift cards?

Taking surveys is an easy way to earn points that you can convert to free gifts. Here are some of my favorite survey sites for earning gift cards in your spare time:

And here’s one more tip for planning Christmas on a budget: turn unwanted gift cards into cash.

If you have gift cards lying around that you don’t plan to use you could swap them for cash at a gift card exchange kiosk. Coinstar doesn’t buy gift cards anymore but there are still plenty of other places that will give you real money for your unused gift cards.


Top Pick for Selling Gift Cards: EJ Gift Cards

EJ Gift Cards makes it easy to sell unwanted gift cards for cash or Bitcoin, without ever leaving home. Just enter your card details to get an instant offer, accept the terms, and get paid fast!

Frequently Asked Questions (FAQs)

How can I have a good Christmas on a budget?

Having a good Christmas on a budget means being willing to get creative with how you spend your money and your time. For instance, instead of spending money on holiday entertainment or outings, look for things that you can do together as a family that don’t cost any money at all. Having a Christmas movie marathon, for example, is a lot cheaper than spending money on tickets to a film in theaters.

You can also have a good Christmas on a budget by remembering what’s most important. Time with people that you care about is priceless and easily outweighs the value of any gifts that might come from a store.

What is a normal Christmas budget?

A normal Christmas budget is around $1,000, according to the National Retail Federation. How much you budget for Christmas can depend on how many people you’re buying gifts for and how much you can afford to spend. If you have a larger family, for instance, $1,000 might not be enough. But if you’re a single mom with just one kid, then you may be able to have a fun Christmas on half that amount.

How can I buy Christmas presents with little money?

Buying Christmas presents with little money usually means being creative about your shopping list. First, narrow it down to the people that you absolutely have to buy gifts for. Next, make a list of possible gift ideas for each person. Then, look around to see where you might be able to find those items on sale.

If you’re having trouble making your budget stretch, you might need to consider some ways to make extra money or get money for free. Taking surveys or selling unwanted gift cards, for example, are two simple ways to get extra cash for nothing. You could also try cashing in your loose change at a Coinstar near you.

How can I save money on Christmas shopping?

Checking out sales early, using coupons, and shopping with cashback apps are all good ways to save money on holiday purchases. With an app like Rakuten, for example, you can earn up to 40% back on purchases when you shop at partner stores. Rakuten also offers special discount codes and coupons to help you stack additional savings.


Want to Get Cash Back When You Shop?

Making extra money is easy with Rakuten!

Rakuten is a free app and browser extension that helps you find coupons and discounts when you shop online or in stores. You can earn up to 40% cashback when you shop at hundreds of partner retailers, plus get a $10 sign-up bonus and up to $30 in bonus cash for each person you refer!

What can I do instead of Christmas gifts?

If you don’t have extra cash to buy Christmas gifts, you might try making them instead. There are lots of Christmas crafts you might be able to make with things around the house.

And if you like to bake, you might make some seasonal goodies for friends and family. You could also the gift of your time to someone in lieu of a gift. Giving someone a hand or simply taking a few moments out of your busy day to have a meaningful conversation can be more valuable than any store-bought gift.

Final Thoughts

Having a fun family Christmas on a budget is totally doable if you’ve got the right plan. You might even decide to challenge yourself as a family to see just how much money you can save. And you can deposit the money that you save into a savings account to get a head start on next year’s Christmas planning.

Need some holiday gift ideas?

Try these 23 fun money gift ideas, which are great for kids. You can also check out this list of 50 thoughtful busy mom gifts along with my favorite gifts for single moms.

What’s your best tip for planning Christmas on a budget?

About Rebecca Lake

Rebecca Lake is a Certified Educator in Personal Finance, freelance writer and homeschooling single mom of two. Since 2014, she's paid off nearly $100,000 in debt and grown her net worth to seven figures. Her work has appeared online at top personal finance websites, including Forbes Advisor, Bankrate, Investopedia, The Balance, and U.S. News & World Report. Find out more.

Comments are closed.