If you really want to avoid that holiday debt, start now

2020-09-24   minute read

Melanie Fuller

The holidays often have a snowball effect: First is the struggle of deciding who to buy for, what to buy and how you’re going to afford it all. Then comes the stress of shopping itself. Finally, there’s the planning for how to deal with the all-too predictable debt.  

Decorated Christmas tree surrounded by glitter

This is supposed to be a time of happiness and family. Wouldn’t it be nice if you had everything covered in advance with no debt to show for it? Below are some helpful ideas for taking back your holidays, reclaiming the season’s happiness and good cheer, and making sense of your festive finances every year from here on out.

Put it away

The first and most important step toward eliminating the holiday credit crunch is to put a small amount away every week from the beginning of year, straight through the holiday shopping season.

Setting aside just $20 per paycheque could add $450 to your budget by mid November. Be sure to put this money into a separate account, though. That way you won’t be as tempted to spend it. Instead you can watch your savings grow and feel the stress melt away.

Change is good

If you have a large family or group of friends, consider changing the way you approach gift giving. Some ideas to keep the spirit high and the costs low for everyone include:

  • Set limits on how much everyone will spend per gift
  • Only purchase gifts for people under a certain age
  • Draw names or hold a Secret Santa so each person only buys for only one person.

These techniques not only save money, but helps to reduce the stress of shopping for multiple people and braving the malls for hours on end during the busiest season of the year.

Make your list and check it twice

Create a list of everyone you need to buy for. Beside each name, jot down some ideas of what you think that person might like. This is especially helpful if you do it consistently throughout the year and revisit your list after conversations or moments of inspiration. 

There are several benefits to this running list:

  1. Proven stress reliever: Getting all your thoughts onto a piece of paper clears your mind and reduces fears around forgetting important ideas.
  2. Eliminates last minute panic: Your list keeps your shopping on track, on task, and on time.
  3. Great planning tool: Helps you avoid the holiday hustle and bustle by identifying where, what and when you need to purchase gifts.
  4. Give meaningful gifts: The extra thought you put in means you’re more likely to buy gifts the recipient will appreciate.

Create your holiday budget

Your list also has a fifth benefit that deserves its own category: All the information you need to create the perfect holiday budget.

Once you’ve determined who you’re buying for and what you’re buying, start doing some online research to figure out the prices of each item. Then, use all that information to build a spreadsheet that looks something like this:






New running shoes




Book series box set








Annual subscription box




Dog toys




Artwork for home office




Coffee shop gift card



Stocking stuffers

Chocolates, toiletries, gift cards, etc.







Now you can cross reference this budget with the holiday savings account you started contributing to at the beginning of the year and whether it lines up with your projected savings. If it doesn’t, you’ll have to make some adjustments, either to what you intend to buy or how much you need to save.

Remember, your budget is the ultimate authority on what you can spend on gifts and other holiday items. Be sure to cross off every category as you go ­— and stay away from competition and impulse buying. What someone else can afford (or is willing) to spend will rarely match your own reality. Be proud of your budget and enjoy the freedom of heading into the new year with no new debt.

Find another way

Try other ways of giving. Hosting friends and family for dinner can be a great way to avoid shopping, save money, and still spend quality time together over the holidays. Let your family know that you prefer to spend your holiday time with them rather than at the mall and use the savings to create the perfect meal for a memorable holiday event. 

Plan, plan, plan…

As soon as the holiday season is over, start your planning for next year. Starting early keeps everything be fresh in your mind. It allows you to re-purpose your list and budget from last year while they’re still handy — and while you can still remember who you bought for and what people liked. Go back to your budget and adjust it to fit the coming holidays.

If you see something on sale that you were hoping to get for someone, get it now (provided it’s in your budget). You don’t have to wait until retailers tell you it’s time to start shopping. Purchasing gifts throughout the year will provide much needed relief during the busy times.

Apps and websites

There are plenty of great gift list and budget apps to help you create your perfect holidays budgets.  These apps can help you make a list of who you’re buying for, what they like, notes about their likes and dislikes, and budgets for each individual. Santa’s Bag is a personal favourite.

And they’re not just for holidays either — these apps and websites are also a great way to prepare for birthdays, anniversaries, and graduations. 

Be comfortable

Your budget is about your life and what you are willing (and able) to spend on the things that matter. There are many ways to show people you care and those that care about you would not want to create a stressful financial or emotional situation for you. Follow the above tips and your holidays should be something you are comfortable with and look forward to throughout the year. 

Address past holiday debt

If debt from holidays gone by is getting in the way of paying your bills and saving for future goals, our team may be able to help. Schedule a Free Confidential Consultation with MNP today to review your financial situation and find out your options for a permanent change.

Our Licensed Insolvency Trustees can provide insight on all the available strategies and services to address persistent debt. This may include a Life-Changing Debt Solution such as a Consumer Proposal or Bankruptcy. But we can also provide insight on other strategies and services that may work best for you.

A Licensed Insolvency Trustee will always provide an honest, unbiased opinion on what will work best for you and how you can achieve a lasting financial fresh start.

Take that first step toward debt freedom today, over the holidays and every other day throughout the year.

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