It’s no secret that Christmas can be a big financial strain for many Australian families. A rather depressing headline in the Sydney Morning Herald commented that ‘Christmas is becoming a luxury‘ – between gifts, food, decorations and travel, the holiday season adds extra expenses many can’t afford.
I think we can all agree that financial pressures are one of the biggest sources of stress over Christmas, especially as the cost-of-living crisis is squeezing household budgets from every angle. Perhaps this is why Aussies are less positive about Christmas this year – it can be hard to get into the festive spirit when your wallet is struggling to keep up!
I refuse to accept that a magical and meaningful holiday season needs a blowout budget, though. That’s why I’ve put together 20 fantastic tips to help you have a merry family Christmas without breaking the bank.
This year, we can prove that budget-friendly holidays are not only possible – they can be the most memorable yet!
Aussies are feeling financial pressure this holiday season
If you’re struggling with your budget this Christmas, you’re not alone. Here are the latest statistics and insights on Australian families’ holiday finances:
- Polls indicate almost three-quarters of Aussies are feeling moderately to extremely stressed about finances right now. (Finder)
- Two-thirds of the nation plan to spend less on holiday celebrations in 2023, thanks to cost-of-living pressures. (Resolve Political Monitor)
- The predicted average spend per Australian adult this Christmas is $1479, including food, alcohol, gifts and travel. (Finder)
- Almost half of Aussies still feel pressured to spend more than they can afford over the holidays. (Salvation Army)
- To cut costs, Aussies say they plan to spend less on presents (67%), dining out (63%) and travel (52%). (Resolve Political Monitor)
- Over half of Australians are staying home for the summer holidays, and only 6% are travelling internationally. (Pureprofile)
- About a third of the country is relying on credit cards for festive season expenses, while 15% will use Buy Now Pay Later services like Afterpay. (Salvation Army)
But don’t let those statistics dampen your holiday spirit! With some creative thinking and a little planning, you can have a magical Christmas without the financial stress.
15 Tips for Celebrating Christmas on a Budget
The theme this year is KISS: keep it simple, Santa! Because let’s face it, the magic of Christmas isn’t about how much we spend, but who we share it with.
Here are my top strategies for celebrating Christmas on a budget:
1. Create a holiday season budget
Before you dive into your holiday shopping extravaganza, take a moment to map out a budget for your gifts, menu, and decorations. By setting clear financial boundaries and sticking to them, you’ll have an idea of your expenses upfront, and you can make more intentional decisions.
Decide strategically what’s most important to your festive experience, and use these priorities to pinpoint where you can save (and where to splurge). This approach empowers you to save extra cash while allocating money for your seasonal must-haves.
It’s all about planning and creative thinking to make the holiday season memorable, meaningful, and easy on the wallet.
2. Be realistic and don’t overcommit
During the holiday season, it’s common to get caught up in a flurry of financial commitments—school festivals needing donations, drinks at the office party, obligatory gifts for the boss, and everything in between. However, it’s important to be realistic and learn the art of saying no when necessary.
Yes, Christmas is all about giving, but there’s no use overcommitting to things you can’t afford. Remember, it’s okay to decline an invitation or skip a donation if your budget is already stretched thin. After all, Christmas is about sharing joy, not depleting your bank account! Find non-financial ways to contribute if you need to (like volunteering).
PS. Skip the round robin for the boss’ gift – workplace etiquette says ‘gifting up’ is a no-no.
3. Avoid the credit temptation
Getting caught up in the excitement of shopping and splurging during the holiday season is incredibly tempting. However, those credit card bills will inevitably come back to bite you, and the last thing you want for the new year is extra debt.
So, resist the urge to overspend and stay committed to your budget as much as possible. If you have to use credit, see if your card has an interest-free ‘four instalments’ option; if you can’t safely commit to that, you can’t really afford it anyway.
4. Meal plan, batch prep & freeze
Meal planning can be a lifesaver during the holiday season. I’m not talking about the big day (more on that menu later) but the weeks surrounding it! With a packed schedule of end-of-year concerts, gift shopping and entertaining, it’s tempting to fall back on takeaway.
Leading up to Christmas, start batch cooking and freezing family meals. As the festive season picks up and everyone is flat out, you’ll always have healthy dinners on hand. Not only will it save you time, but it can also help you avoid the takeaway temptation.
5. Stick to simple holiday decor
When it comes to decorating for Christmas, there’s no need to go overboard. A few well-placed festive touches can create a magical atmosphere in your home without an extravagant price tag.
One of my favourite tricks for creating a cosy atmosphere is incorporating candles throughout the living and dining areas. You can mix different types of candles, such as pillars, tapers, small votive candles, and even some beautifully scented ones. As a bonus, you can use candles year-round rather than sticking them in a box for the next 12 months.
6. Don’t go overboard on the Christmas menu
The number one cause of unexpected Christmas expenses is going overboard! This year, avoid getting carried away and thoroughly plan your mains, sides, appetisers and desserts (check out my healthy Christmas recipes for some ideas).
There’s no need to create a festive feast fit for a king. Account for the number of guests, portions per person, and a bit extra to make your shopping list. It’s okay to be generous (and leftovers are always a good thing), but don’t buy ten times the food you actually need, either.
For even smarter Christmas menu planning, choose dishes that make great leftovers and plan a few recipes to use them up between Christmas and the New Year.
7. Cook more from scratch
More Aussies are cooking and eating at home this Christmas, according to recent Coles research. If you’re looking to save money, it’s a great strategy: cooking your holiday spread from scratch is healthier and easier on the wallet.
Go through your menu plan and consider where you can swap packaged foods for DIY. Do you really need your Christmas chook pre-stuffed, or can you make your own seasoning? A classic pan-dripping gravy only takes a few minutes to prepare, or try this 10-minute cranberry sauce recipe. Of course, skip the ready-to-roast chopped veg and buy the fresh stuff for a fraction of the price.
Plus, it’s an opportunity to get the whole family into the kitchen, baking cookies, making dips, or whipping up desserts. When you look back, those might be the memories you treasure most!
8. Save on your grocery spend
Christmas cookies made with home-brand flour taste the same as the fancy stuff! Don’t get me wrong, quality food can be worth spending on. I always recommend buying the best quality meat you can afford, for example. But plenty of products are just as tasty and nutritious from a store-brand range, including the Coles and Woolies ‘premium’ lines.
Look for cheap seasonal produce – broccoli, cauliflower, and iceberg lettuce are 40% cheaper than in 2022. Fruit lovers rejoice as cherries are about a third of last year’s price, with great value prices on stonefruit and berries, too.
Hunt down specials or bulk-buy options to save extra dollars on Christmas groceries. Loyalty points programs have terrific deals around this time of year, too.
9. Suggest a gift limit or Secret Santa
The cost of Christmas gifts can be eye-watering, especially when you have loads of relatives to shop for. If you’re feeling the pinch, chances are that everyone else is too! Be a hero this year and suggest a strategy to keep things fun without breaking the bank.
One in five Aussies has implemented a gift limit this year, so why not jump on the bandwagon if you haven’t already? For example, suggest that everyone sticks to a $20 or $30 limit for gifts. After all, it’s the thought that counts, not the price tag, right?
Offering to organise a family Secret Santa exchange is another savvy strategy to ensure everyone gets something thoughtful and no one feels burdened financially.
10. Dial back on the booze
Many of us can’t picture Christmas Day without a few drinks! However, the cost can quickly add up if you find yourself hosting the gathering.
Remember that you’re hosting a family gathering, not opening a full-fledged bar! You have every right to buy more affordable options or kindly request that guests BYO drinks. If someone’s Christmas will be ruined without a vintage drop or craft brew, they’re welcome to provide it themselves.
Making a punch or sangria is a clever way to make the most of a cheaper bottle of plonk – check out my recipe for 100-calorie sangria.
11. Make use of leftovers
Don’t let any of your Christmas feast go to waste! Get creative with leftovers and turn them into new, tasty dishes. Not only will this help reduce food waste, but it’s also a great way to save time and effort in the kitchen during the busy holiday season. Who doesn’t love a good post-Christmas toastie?
Freezing leftovers can be a great way to avoid waste – just keep food safety in mind. Don’t freeze those turkey scraps after they’ve been sitting out for hours! Instead, platter up just a portion of the bird and keep the rest in the fridge, then freeze leftovers later that night.
Here are a few more ways to use Christmas leftovers:
- Add leftover meats or roast veg to a healthy frittata
- Use bits of cheese and leftover greens to make spinach & cheese muffins
- Toss leftover seafood into a delicious spicy stew
- Crumble leftover Christmas cookies over chia pudding or a smoothie bowl
- Make pita bread pizzas with leftover roast meats and veg
- Turn leftover mashed veg into veggie fritters (feta optional)
12. Avoid the ‘last minute mark-up’
Let’s face it: when you’re hunting down that perfect present on December 24th, you end up spending a lot more than you’d like to! By getting a head-start early in the year, you can take advantage of the ‘early bird’ effect and save money.
I recommend keeping a big list of all the people you need to buy for, plus a few ideas for each person. Then, keep an eye out for sales – a savvy one-quarter of Aussies do their Christmas shopping with Black Friday discounts. Not only will this save you a few bucks, but it also spreads the financial burden throughout the year.
Bonus tip: if you spot a great markdown on a crowd-pleasing present (think candles, colouring books or a fancy jar of lollies), grab a few for backup gifts.
13. Get the kids creating handmade gifts
I know, it’s a cliché by now! When you think about it, though, what would Grandma treasure the most: another store-bought bath bomb set or a unique handcrafted present from the kids? Not only will you save a few bucks, but you’ll also be giving a genuinely heartfelt gift that’s sure to be treasured (imperfections and all).
Crafting or cooking is a great school holiday activity for the kids, but try not to overcomplicate it. Stick with something that’s appropriate for their age group, or you’ll do the whole project yourself.
Here are some ideas to start with:
- 45 Gorgeous Gifts Kids Can Make
- 115 DIY Christmas Gift Ideas for Everyone on Your List
- My Top 5 Protein Ball Recipes (fill a jar, then add a fancy ribbon and label)
14. Consider a gift-free Christmas
This year’s average gifting spend is $373 – so instead of buying even more stuff no one needs, why not lighten the burden with a gift-free Christmas?
At the end of the day, gifts are just one part of the festive season and certainly not the most important. Especially if you don’t have little ones awaiting Santa’s visit, skipping the presents can reduce the stress for everyone involved.
Focus on making memories instead, whether that’s a vacation or a memorable day spent together. Remember, the best things in life are often not things at all – it’s the people we share them with that truly matter.
15. Make a recovery budget for the new year
If you’ve gone overboard with your holiday spending, don’t panic! Take a moment to sit down and plan a realistic budget for the upcoming months.
If you did go into debt this Christmas, work out a realistic timeline to pay it off. Is there any ‘discretionary spending’ you can cut back on, even just for a few months?
This proactive approach isn’t just about the financial perks, either. It’s about taking charge of the situation instead of getting stuck in anxiety – and trust me, it’s a game-changer!
When budget overwhelm strikes, my top tip is to sit down and plan. From interest rates to grocery prices, there’s so much we can’t control, but instead of feeling helpless, it makes a big difference to focus on what we can do.
Wrapping Up
Take a step back this Christmas and focus on what matters – love, joy, and time spent with loved ones. Saving money is almost a side effect of getting our priorities right! Creating a financially healthier holiday celebration sets us up for success in the New Year.
The reality is that many families aren’t worried about how to celebrate this month. Instead, about a third of Aussies are struggling with the basics, like keeping hungry bellies fed or having a safe place for their kids to sleep.
I understand so many people are doing it tough right now, but if you have a few dollars to spare, why not embrace this spirit of giving this festive season? Here are a few ways to contribute:
- Foodbank: 15% of Australians are facing food insecurity, and a third of those are kids. Every $1 donated provides two meals to Australians in need and helps Foodbank distribute a record 40,000 family food hampers.
- Vinnies Christmas Appeal: Donations help families in crisis keep a roof over their heads, put food on the table, and keep the lights on this holiday season.
- The Smith Family: Help disadvantaged kids keep up with their education by donating or purchasing charity gifts, available from $20 and up (including a printable card or eCard for your gift recipient).
- Two Good Co: Purchase fab Christmas gifts from this store, and 50% of the profits will help unhoused or at-risk women rebuild their lives and regain their confidence.
Donations of $2 and over are tax deductible for all three charities above.
Alternatively, look for local organisations in your community that provide food parcels, housing support and other vital services. If you can manage it, consider donating a few dollars or ask how you can volunteer in the New Year.
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Of course, the budget stress doesn’t end once the Christmas carols fade away. To help your budget hit the ground running next year, here are a few handy articles:
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