Our Favorite Strategies for an Inexpensive Holiday Season

Over the last several years, Sarah and I have had a very busy holiday season. We’ve celebrated Christmas with our three children and many different holiday gatherings each year with family and friends. We decorate our house each year for the holiday season, usually on the first weekend of December.

Those activities, from the decorating and the traveling to the gift-giving and the eating, add up to some serious expense. Each year, Sarah and I plan ahead for these costs, both in terms of saving money and in terms of implementing methods for spending less.

Here are eight strategies we implement each year to cut back on our holiday spending.

If you’re unsure what to give, give consumable gifts, ideally homemade ones

If your social circle is anything like ours, your gift list is a fairly long one and includes at least some people that are … shall we say, difficult to buy for.

The problem with hard-to-buy-for people is that it’s really easy to wind up giving them a gift that just fills up their closet – and that item ends up just being an expensive waste of everyone’s time.

Our solution is much simpler – give consumable gifts, ideally ones you’ve made yourself.

In past years, Sarah and I have made numerous homemade gifts, many of which we’ve turned into visual guides. Some of my favorites include vanilla extract, homemade soap, caramel apple jam, homemade beer, wine jelly, jar meals, crocheted clothing, personalized stationery, handmade ornaments, photo cubes, and homemade cookie bundles. Each of these gifts is pretty inexpensive to make and, although some of them do take some time, most are pretty easy.

If making a gift isn’t your style, simply give an edible gift of some kind. A nice bottle of wine, a six pack of good craft beer, a couple bars of delicious chocolate, summer sausage and cheeses, some popcorn and seasonings… there are many, many edible gifts that people will actually appreciate. Not only that, it’s pretty easy to shop around for appropriate food items.

Make your own gift tags

Rather than buying gift tags, we just take small squares of matching wrapping paper, write the “to:” and “from:” information on the white side of the paper, then fold it in half and tape it to the wrapped gift.

These “tags” are essentially free and visually melt right into the wrapping paper, making them almost unnoticed. I like the visual appeal of a gift without a tag on it anyway, so we often put the tags on the bottom of gifts.

Decorate naturally

Rather than buying expensive decorations for Christmas, decorate as naturally as possible, using the bounty of the outdoors to make your home beautiful (and often add a wonderful subtle aroma). The best part? It’s free.

Just gather cuttings from pine trees, leaves, gourds, pine cones, berries, acorns, and so on and use them for the basis of decorations. They can make the mantle and the windowsills look wonderfully festive.

At the end of the season, such decorations can easily be discarded to the compost pile or in the trash, as such items decompose quickly.

christmas decorations
Some of the best holiday decorations are free in nature, such as pine cones and cuttings. Photo: Bretislav Valek

Save classic decorations from previous years

Every year, our children make a few handmade decorations – ornaments made out of salt dough, paper snowflakes that are colored and laminated, and so on. They add a certain childlike wonder to the decorations. Sarah and I usually make a few decorations, too.

Some of them are pretty forgettable, but we each usually produce an item or two each year that’s really memorable. Those items get saved for future years.

Thus, the next year, we open up our decoration boxes and find that we have tons of interesting and memorable things with which to decorate our home. We literally have more things than we can use right now, which gives us some choice, and we nave no reason whatsoever to buy any more.

Plan your meals way in advance

The best time to make your holiday meal plans is right now. That’s right, start sketching out your holiday meal plans today, not on December 20th or so.

Why do it so early? Throughout December, most of the ingredients you’ll actually need for the meal will go on sale at some point. If you have a meal plan (and the resulting grocery list) already prepared, you can buy most of the items as they go on sale during the month. (Some of the items may require freezer storage, but that’s perfectly fine.)

Another useful part of this strategy is sometimes you’ll have everything you need for one of the side dishes in the middle of the month, so you can actually go ahead and prepare it, just freezing it just before the final cooking. Then, you can pull it out of the freezer a couple days before the big meal, meaning your only responsibility on the big day is to simply toss the item in the oven.

Replace big gift exchanges with a Secret Santa

At some family holidays, everyone is expected to give a gift to everyone else, so the end result is that everyone has several cheap gifts while also feeling financially tapped out because of all of the gifts they were supposed to buy.

A much better approach is to institute a Secret Santa exchange. Just allow everyone to draw a name out of a hat of someone else in the exchange, then put a bit higher total on the exchange than you might have spent on individuals in the past.

That way, everyone spends less overall and everyone winds up with just one gift that they may actually really like.

Another idea is to do a “themed” Secret Santa – like exchanging DVDs or food items – or to do a “white elephant” exchange where people can swap items during the gift opening.

The whole point is to reduce the expense for everyone while maintaining the fun.

Make your own holiday cards

Over the last few years, we’ve been lucky to have some gift cards which make cards from Shutterfly incredibly cheap, but in years prior to that, we printed our own holiday cards at home.

We simply purchased some inexpensive card stock and envelopes from a local store (we started watching for sales early in the year), made a very simple design in Microsoft Word, and printed them on our home printer. They turned out very simple but tasteful and beautiful.

According to our calculations, these cards – including the cost of ink – were less expensive than only the cheapest dollar store holiday cards.

Buy all of your wrapping paper and other holiday supplies for the next year on December 27th (or so)

Wrapping paper can be a big expense, especially if you’re wrapping a lot of gifts. I’m often shocked at the cost of holiday wrapping paper during late November and early December.

The trick, of course, is to buy those kinds of items a few days after Christmas when the stores put their wrapping paper, bows, tags, and other such holiday items on steep discount in order to clear their stock. We just buy plenty for the following year, then stow it in the basement storage area with the other holiday items when we put away our holiday decorations.

That way, when we unpack things next November, we’ve already got all the wrapping paper we need for that year’s gifts.

If you’ve made the decision to purchase an artificial tree for next year, buying that right after the holidays is similarly smart. Stores will discount their trees quite steeply in the last week of December in order to move stock so you can get one at just a fraction of the price.

Final Thoughts

There are many, many clever little things you can do throughout December to save on the holiday season. The tips above just scratch the surface. These strategies just happen to be the ones that Sarah and I have used successfully in our own lives over the past few years in order to cut back on the costs of the holiday season. Hopefully, some of these moves will help you keep more of your money in your pocket or help you to direct it to more useful things.

Trent Hamm

Founder & Columnist

Trent Hamm founded The Simple Dollar in 2006 and still writes a daily column on personal finance. He’s the author of three books published by Simon & Schuster and Financial Times Press, has contributed to Business Insider, US News & World Report, Yahoo Finance, and Lifehacker, and his financial advice has been featured in The New York Times, TIME, Forbes, The Guardian, and elsewhere.