Planning for Christmas, in July, makes perfect sense to start saving money for Christmas!

The Christmas season has got to be one of my favorite times of the year! Yet, it’s also filled with anxiety, some frustration, and a whole lot of cookie dough eating! (please tell me I’m not the only one!)

We have such high expectations of the holiday season, continually trying to recreate the magic we felt when we were children. Yet, I’m not sure that I can ever get that “feeling” back. There seems to be too much to do, constant errands and family gatherings, and (sometimes forced) cheer, which tends to wear this mama out!  

As adults, we also now face the dreaded credit card bills that come in January from all of our holiday spending. We open the bill, and a lump lodges itself in our throat, and then it falls with a thud into our stomachs. We set the bill down and walk away. Thinking that it will be different the next time we pick it up.

Sorry to burst your holiday bubble, but it’s not going to change. Unless, of course, you don’t get that bill.  Huh?  No, you’re not going to move houses to evade a credit card bill 🙂 You’re just going to take an afternoon in July and plan out how you’re going to save money for Christmas this summer! Trust me, it will FUN and absolutely worth it, because who doesn’t love Christmas in July!  Yup, Summer is the perfect time to start your Christmas Savings Plan.

Christmas Savings Plan

This post may contain affiliate links. Please read my full disclosure for more info

This post is Part One in A Christmas Planning series, be sure to check out Part Two, Your Ultimate Guide to Making a Stress Free & Debt Free Christmas Budget!

Christmas credit card debt in America

Why would you want to ruin a perfectly good Christmas in July by thinking about making a Christmas savings plan? I mean saving money for Christmas now is too soon! “Ugh!”

I know it doesn’t sound fun, but the reality is we need to think about this, because like it or not, we’re adults!    

According to CNBC, the Christmas debt hangover is real! “Among those who put all those holiday presents on plastic, less than half of shoppers, or 42 percent, said they’ll pay off the debt in three months or less. More said it would take five months or more to pay it off, MagnifyMoney found. Nearly a quarter or 22 percent said they would only make the minimum payments.”

What’s even more troubling is that “For a borrower making a minimum payment of $30 a month on a $1,230 tab, that means it would take more than five years to pay off the balance — and you’d also be shelling out $592 in interest over that time (assuming an annual percentage rate of 16.5 percent).”

Wouldn’t it be great to bypass that January bill altogether? You can, and I’m going to show you how! Because you don’t need the stress and anxiety that comes with financial debt! That just drags you down and clouds everything around you. It steals the joy from the holidays and keeps you from appreciating the small blessings that come with the season/

5 steps to having a stress free (and debt-free) Christmas

  1. Have a Christmas in July (it’s July 24th)
  2. Start saving money for Christmas now for your grand total budget number
  3. Figure out how much you need to save each week/month to reach your goal. How will you do it?
  4. Plan how much you want to spend on each budget category (food, gifts, events, etc.)
  5. Stick to your budget!

Why Summer is the best time to make a Christmas savings plan

Honestly, summer really is the best time to start the Christmas planning process! Why? Because Christmas is so far removed, there’s none of the stress associated with it that typically comes when the holiday season is looming over our heads. Your shoulders aren’t hunched, and your to-do list isn’t as crazy like it is in November.

It’s summer, so you’re relaxed and happy with all that vitamin D soaking into your skin. You haven’t experienced Christmas in 6 months, so you’re not totally “over it” like you are in January. Along with that sitting inside and watching a Christmas movie sounds like heaven (probably because it’s 101 degrees outside)!

Plus, the holiday season is far enough away that saving small amounts each week adds up to a nice big chunk-o-change! It’s totally doable to save $500, or $750, or even $1,000 for Christmas spending!

Step 1 – Do a Christmas in July

It would seem counterintuitive to celebrate Christmas twice, but go with me here! You are going to have a little mini Christmas planning party, and it will be loads of fun! Invite your best friend over, or spend it with your mom, or even by yourself for a relaxing afternoon.

What is Christmas in July?

Believe it or not, but the unofficial holiday originated in 1933 at a girl’s camp in North Carolina. The camp counselors were just doing something fun, and it went off so well that they did it year after year, and it spread across the US.

Your Christmas in July holiday planning

There is a dual purpose for you celebrating, first is to relax and enjoy yourself. The second is for you to plan Your Ultimate Stress Free & Debt Free Christmas Budget! (Your Christmas Savings Plan is a part of this) Now, I’m not talking “budget” as in cheap, or necessarily a frugal Christmas (it certainly can be if you want).  

I’m talking about Christmas on a Budget, as in planning out how much you want to spend this Christmas because you will eliminate that dreaded January credit card bill! This year it’s going to be a debt-free Christmas for you and your family!

This means no guilt of overspending, no worry or anxiety about how you’re going to pay for things! And no last-minute scrambling to get your holiday planning or shopping done!  

Supplies for your Christmas in July

If you want to have fun and really get into the spirit, then there are a few things you’re going to need! Don’t worry, they are inexpensive (you probably already have them)!

  1. Christmas movies; pick 2-3
  2. Hot chocolate
  3. Christmas jammies
  4. Turn on the a/c so you can cuddle up with your blanket on the couch
  5. Grab Your Ultimate Stress-Free (Debt Free) Christmas Budget, whew, that’s a long name for a Christmas budget, but that’s precisely what it will do for you!

How to do your Christmas in July holiday planning

I want you to schedule this for a time when you’ll be relaxed, while kiddos are out playing for the afternoon, or when the house is quiet. Put on your holiday jammies, crank the a/c and make your hot chocolate! You can even get out a few holiday decorations to spruce up your TV room!

Put on your first Christmas movie and just enjoy it! One of my favorite holiday guilty pleasures are the Hallmark Christmas movies. No idea why I love them so much, maybe it’s the right amount of corny & cute! But you can’t beat the old fashioned classic Christmas movies & cartoons, and everyone in the family loves them!

What if I’m reading this after Christmas in July?

First of all, no worries! You can still save a good amount of money for Christmas, even if you start in the fall! You may have to save more per month to reach your goal. Or take it to the next level by getting a part-time job, but it’s still doable.

The number one factor for nor going into debt this Christmas is to establish 

  1. Who you are buying presents for
  2. The gift budget per person

And stick to it 110%! That right there will take you 75% of the way to saving your credit cards from swipe burn (Post 2 in this series has some great ideas on how to stick to your budget!) So still keep reading, the information is totally applicable even if you’re starting late!

Step 2 – Saving money for Christmas (aka a Christmas Savings Plan)

During Christmas movie #3 let’s take a look at how you can actually save money for Christmas! This is your official Christmas Savings! (sounds pretty official huh!)

This is the not so secret sauce of you having a debt-free Christmas! You’re going to save for it beforehand (aka a sinking fund)! Yes, this doesn’t sound like “fun,” but trust me, come Black Friday, you will be so happy (and relieved) to have the cold hard cash in your hand! Yup, no crazy high credit card debt, just cash (or a Prepaid credit card if you wish, I do this).

I’ve given you a few different Christmas savings trackers to use in the Stress Free (Debt Free) Christmas Budget Workbook. You can use them for your different categories (food, gifts, fun, etc.). Or just use your favorite and save for the total amount.

Don’t forget to time the end of your Christmas savings plan correctly. Even though as of Christmas in July (July 24th), there are six months until Christmas, you probably need to have your savings for gifts done by Black Friday, so you have time to shop. You have an extra few weeks to save money for Christmas dinner spending.

That means in 2020, it’s a full 18 weeks to be done by Nov 27th, which is Black Friday. While your Christmas dinner savings has up until a week to 10 days before Christmas (about an additional three weeks). So time your end dates strategically!

Christmas Budget Workbook mock up

Ways to save for Christmas

There are many ways to save money for Christmas, it’s up to you how hardcore you want to go!

  • Use digit to automatically save small amounts
  • Stockpile your ibotta savings
  • Hold a garage sale
  • Sell handmade items online (be sure to grab your online sales tracker)
  • Use your credit card rewards (cashback or gift card redemption)
  • Get a part-time job for a few months
  • Do a no spend month (or just two weeks may be enough), find the perfect money saving challenge idea here!
  • Plan your purchases for sale times (Black Friday, and remember that Amazon Prime Day is in September this year!) Don’t forget to be searching for gifts all year long, so that when it goes “on sale” you’ll know if the sale price is indeed a good deal!

Where to put your Christmas savings

Christmas Club Accounts  

There are these fun, quirky accounts called Christmas Club Accounts, popularized in the ’70s. According to Bankrate, they are short term savings accounts usually found in smaller banks or local credit unions.  

“Rules and requirements for Christmas Club account holders can vary from one bank or credit union to another. With some accounts, there’s the opportunity to earn interest. And at some banks, Christmas Club accounts more closely resemble CDs. There’s a penalty for any withdrawal that happens prior to a certain date during the holiday season.”

Basic checking account  

If you don’t have access to a Christmas Club Account, you can easily open your own separate bank account. The “separate” part is critical! And use that to hold your savings. Just make sure you can’t easily transfer to other accounts as you don’t want to end up borrowing for this and then have nothing come November!

Use a cash envelope

You can save all your funds in one cash envelope and then divvy it out to other “sub-account cash envelopes” totally doable, and this is how I keep my Christmas money (please don’t rob my house).

Check-in on your progress

You have your plans, and you’re ready to go! (Yaaa!!!) The last thing you want to do is let time get away from you. Set a reminder in your calendar to check in on your progress every month up until October, and then every two weeks until it’s go time! Ask yourself…

  • Are you saving what you wanted?
  • Do you need to pick up the pace? How will you do that?
  • Does your gift list still look accurate? Need to add anyone to the list?
  • Start saving recipe ideas, look at the local events calendar for things to do, make plans with extended family, etc.

At the end of the day

By the end of movie #2 you should have a framework for how you are going to fill your Christmas savings plan, either out of your regular monthly budget (i.e., putting away $20 a week) or selling items or getting a part-time job. Whichever way you do it, I know it’s going to work great!

Don’t forget to check out post #2 in the series of Your Ultimate Guide to a Stress-Free & Debt Free Christmas Budget. Here we’re going to take all that money you saved and put it to work!

Christmas Budget Workbook mock up

Articles relating to Christmas Savings Plan:

How are you going to save money for Christmas? Are you going to do a Christmas in July planning holiday?