How to Budget for Christmas

Christmas is a very expensive time of year, especially if you have children and/or a large family. This year is harder than ever as the rising cost of living is leaving most of us with even less money available. The temptation is to put it all on the credit card, but I would hate for you to open that statement in January sick with worry about the amount of money you spent on Christmas. New Year is a time for fresh beginnings and new starts, not fretting about how long it will take to pay it all back (do check out my debt resources if you need help though).

Instead, why not take the time now to write that Christmas budget and figure out how much it’s going to cost? Writing it all down will help you to work out what you can and can’t afford to do, as well as identify where you can cut back and save a few crucial pounds. It will enable you to really think about the total cost of Christmas and what you can afford.

Grab a piece of paper and a pen and let’s budget

I like to go old school with a piece of paper and a (Christmassy) pen, but go for the technical spreadsheet or notes app on your phone if you prefer. Write a list of everything you need to spend extra money on this Christmas


Who do you NEED to buy presents for and who do you WANT to buy presents for? Are there random people on the list, like aunts, uncles, and cousins? Do you REALLY need to gift that Boots Bath set again? Why not have that conversation about stopping the gifting? This year more than ever you might be surprised how relieved they are that you’re mentioning it. Even close family – is it possible you could buy less? I remember as a child counting up my gifts and thinking, ‘wow I have 10 gifts,’ which felt like a HUGE number of presents. My children won’t ever have piles of 30 presents that they rip open in 15 minutes flat and not appreciate who has given them what. I don’t want them to expect this kind of treatment every Christmas or birthday.

I heard a wonderful comment on a radio interview last year from a caller speaking to Nicky Campbell and me on BBC Five Live. They said:

To my Children at Christmas. Think of :-

Something you want, something you need, something to wear and something to read.

My gift list – Three Boys, 10,13,15 £100 each. Ideas/bought so far,

Books – football related like this book by Micah Richards or Captain Underpants or Fact books like this Curious Minds book that my youngest will adore

Coat H&M (save £5 by taking in a bag of old clothes – I have around 30 bags to take in;-)),

PJs – Again H&M, I’ll do separate transactions to save another £5 with another bag of clothes on a different day, and I have £3 coupon in my H&M app to use.

Nike Trainers for Eldest. I have been saving up my Top CashBack money for a few months and have £286 in cash back to use to buy Christmas gifts. If I exchange my Topcashback savings for Nike vouchers I get a 6% bonus.

Adidas Football Boots for my middle son, again using my Top Cashback vouchers, also a 6% bonus if I turn the cash into vouchers. Alternatively, you can just withdraw the Top Cashback money as cash into your bank account.

I bought a French Connection smellies set back in September in Boots when there was a 60% off sale, £20 rather than £50. This set will be split 3 ways between my boys.

I found my eldest son’s favourite scent in Barcelona recently in Sephora, with an extra 25% saving on Black Friday. It was £30 cheaper than if I bought in UK!

Other Gifts

I am having an early Christmas celebration with my Cornwall family. There will be gifts exchanged with them. I am spending £100, so £33 each on them. They will also be getting homemade presents, including chutney, infused gin, yule log and fudge.

I am gifting some homemade presents to a few wonderful friends who have been there for me this year and the past few years of annus horribilis. This will cost around £50 for enough presents to give to five people.

Christmas Chocolate Yule Log

A Gift to Myself

A wonderful thing that every single mum or dad could think about. One thing YOU really want. Something you have been coveting that you can afford. I bought myself a little something whilst in Barcelona recently, taking advantage of the 25% off everything Sephora sale. I treated myself to some Kat Von D make up. Not easy to find in the UK, and hugely cheaper in the Black Friday sale.

Total Gift Budget is £550, including £100 for myself. But £280 is covered by Top Cashback reward vouchers I have been saving up. I have also been saving my Boots, Tesco and Nectar points where I have £100 in vouchers saved. Plus I am awaiting a £200 cash reward for switching bank accounts. This means that all my Christmas gifts are paid for.

Can I sell some stuff before Christmas to help cover more of the Christmas costs? Of course I can, we have already sold a Nintendo Switch and some Guu Jutzu toys for £70.

Christmas Food

Christmas Food doesn’t have to cost the earth. I wrote an article last Christmas where I cooked a three course, Christmas Dinner, using Aldi food for less than £4 per head (inc a bottle of fizz) and am in fact revisiting that article for my regular work with the Mirror this week. I wonder how much it will have gone up by.

This year I am not cooking a Christmas dinner, in fact I will be driving from Cornwall to Hertfordshire on Christmas day! Quiet roads, and I am really not fussed, as I get to see my boys in the evening this year.

I am budgeting £50 on Christmas treats for my boys and me. I will get some nice cheese and chocolates and will pay for this using my Clubcard and Nectar vouchers.

Total food spend is £50, all will be covered with Tesco/Nectar vouchers.


This is often a big cost for me thinking about previous years but this year I and everyone else is pulling back. Most of us cannot afford big nights out drinking and dinners out. I have a couple of spa days with friends in early December, already booked, and paid for (last Christmas hah). Plus one local pub (The Station) Christmas dinner with a friend and my boys. I am allowing £60 for this and also won’t be drinking. There may be a few other smaller Christmas gatherings when in Cornwall, so I will allow a £100 budget for socialising.

Travel to Cornwall

The trains are incredibly unreliable currently, are the train strikes on or off? So this year I am driving to Cornwall. It’s a 300 mile trip so costs around £90 in fuel in my hybrid car. I am collecting my niece half way down from Bristol so will share some of the journey costs.

If you are getting the train, buy as early as possible, six weeks is the optimal time, although we are past that time now! You can buy your ticket on the Trainline and get a Top Cashback discount and don’t forget to use railcard discounts such as Friends and Family Railcard and Network railcard for the South East. I have both of these. I managed to get train tickets to Cornwall for three of us for £120 last year.


Zero costs here. I don’t send Christmas cards, I give to charity instead, and have been giving a lot via my current Team Challenge. 20,000km from North to Soth Pole.

I have tons of decorations already and do not need a single new decoration, unless I get crafty and make some (unlikely with the amount of work I have between now and Christmas). And I have been collecting packaging from parcels over the past few months to use as wrapping paper this year.

There we have it. Total Budget

Gifts £550 (but all covered by Top Cashback vouchers, loyalty cards, Bank account switch reward)

Food £50 (but covered by loyalty card reward)

Socialising £100 (covered with selling things, £70 made already)

Travel to Cornwall £90 (part covered £10 with lift sharing)

Total Cost of Christmas £790

But with my money made and saved up in loyalty cards of £650. Christmas is pretty much covered!

For more ideas and insights from me about Christmas budgeting, check out my article from The Sun and this post I wrote for Zopa on low-cost gifting.

What about you? What is your Christmas budget looking like?

This post contains affiliate links where I receive a small fee if you sign up/buy. This does not affect the price you pay.


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Lynn Beattie

Aka Mrs MummyPenny

Personal Finance Expert

I write about personal finance made simple, lifestyle choices that will save you time and money, as well as products and services that offer great value.

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