Unexpected layoffs had us scrambling to survive christmas with no money a few years ago. Here is how we made a Christmas budget and embraced inexpensive (or free) gift ideas. For an affordable gift to help center you (or someone you love) during Christmastime, check out my 25-day Advent Devotional, Unexpected.

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I pulled my hand back into the car from the ATM and looked down at the five, crisp bills. "This is it," I thought to myself. This is all we have to spend for Christmas.

My husband had entered the arena of unemployment thanks to an unexpected layoff a few years prior; the subsequent job he picked up only lasted a year. We found ourselves in a scary, frustrating place not one, but two, times.

Money was tight and our identities were shaken.

Facing Christmas when money is tight

Our privilege and suburban comforts became painfully obvious as we wrestled with how to have a great Christmas without much money. I had to accept that Christmas wouldn't look like scenes from TV and glossy magazines. There wouldn't be an abundance of bright red packages wrapping expensive, new toys and trinkets for our loved ones. Heck, not only would our holiday not look like the American standard for Chritsmas, but it wasn't going to be anything we were used to. 

I felt disappointed and sad, not towards anyone in particular, but in the situation. It's hard when money is tight and you're not used to thinking, "How am I going to have a good Christmas with no money?" Although our bank account could spare a little bit to spend (yet not nearly as much as previous years), affording Christmas was one stressor I wished would go away.

Questioning holiday values

Bitterness and comparison came quickly and made it nearly impossible to not envy others who didn't struggle with affording Christmas. Pride chimed in too. I knew that if we asked friends and family for help, it would take only seconds to receive it. But I didn't want to share our need: it was hard enough living on a super-tight budget, inviting others into our reality felt cripling.

Yet despite the negativity I was battling, my heart was starting to change. I began to question the holiday traditions and why I felt like they were ruined if we didn't have a lot of money for Christmas. In the midst of questioning my values around the holidays, unexpected blessings came: a bonus check from my job, a love gift from a family member, and a few coupons in the mail. 

This gave me the boost to not only change the way I approached Christmas, but accept a Christmas with little to no extra funds. It helped me embrace setting up a Christmas budget and giving gifts that cost me very little to no money.

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A Christmas Budget

As I recognized the feelings that came when I thought I had no money for Christmas, I gave myself some space and worked through them. Once some of the shame and grief passed, I realized that I did have some money, and in fact, I had enough to survive the holiday. I just needed to draw up a Christmas budget and get creative. 

Christmas budgeting and planning

First, I put how much cash we had to spend at the top of the page—this was the total of those five crisp bills I withdrew. I added to this amount when the bonus and love gifts came.

Then, I began listing out all of the people I wanted to give a gift to and other expenses I new would come up, like decorations and food. I grouped the people who needed a tangible gift. Also, I made a list of gatherings we planned to attend that required gifts. For us, this looked like: 

  • Daughter
  • Nieces and nephews
  • Kids who we celebrate with
  • Our parents
  • Siblings
  • Home church white elephant exchange
  • Friends gift exchange

After making a list of everyone we wanted to offer a tangible gift to, we then evaluated if the gifts needed to be new and store-bought, or if something re-gifted or homemade could work. We discussed each person, and even made a few phone calls to discuss gift exchanges. For example, with our siblings, we decided to spend our money on the kids and not exchange gifts between us adults. With our friends, we decided to do a fun activity together in lieu of gifts.

Once these plans were ironed out, I had a list of where our money needed to go. I divided the balance between the people on our list and the gatherings, and since we were working with cash, we searched for gifts that fit our allocated amounts.

We gave ourselves permission for the amounts to be small. 

Christmas spending boundaries

The Christmas budgeting process was helpful for us. As we implemented it, we followed these boundaries: 

  • Avoided using the credit card (unless we bought something online, which we then paid off right away).
  • Didn't buy "the big deals" that year (which taught us we didn't need the products in the first place).
  • Bought only what we needed for decor: a few strands of lights for the tree.
  • I used left over wrapping paper, bows and bags from the previous holiday instead of buying new.
  • Gifted gift cards to stay inside of our budget.
  • Baked homemade treats because it was affordable and it served as a Christmastime activity.

At the end of the season when we tallied up what was spent, we had stayed within our budget. Those five, crisp dollar bills from the ATM carried us through. And the best part: January and February were much less stressful too.

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Christmas ideas that cost no money

For a few people, we gave gifts that didn't cost us any money (or less than $10). There's a lot of ideas like this! Like what?

  • Prayer books: Encouraging notes and prayers for a person inside of a small notebook.
  • Babysitting: Offer parents childcare instead of a tangible gift.
  • A night out: Get friends together for a meal. The time spent is gift enough!
  • Volunteerism: Give time to an organization on behalf of someone who's passionate about the cause. Volunteer together!
  • Listening: Sitting down for tea or coffee, looking someone in the eyes, and listening, can be the best gift for some.
  • Story sharing: Either capture someone's story, or ask them to tell it. 
  • Scripture: Write verses on cards to pin up, especially if the verses were put on your heart specifically for that person.
  • House help: Offer to help tidy up, rake the leaves and other house chores. (GREAT for working moms!).
  • Playlists: Compile a playlist for someone based on songs you think they'll like and inspire them.
  • Something personal and special to you: Re-gifting something meaningful that you already own isn't only emotional, but it's priceless.
  • Hug coupons: For the personal touch lovers, you can never offer too many hug coupons.
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No money for Christmas - a learning experience

The cliches about the holidays can be true: The spirit of Christmas isn't just about dollars and cents. But for those of us in America,  this can be really challeging to accept. Christmas is so intertwined with money, it can be a painful experience when finances are lean. Nobody wants to be the one who can't afford a gift, or who skips the party because even the $5 White Elephant gift exchange was a burden.

Having hardly any money for Christmas can be embarassing, it can bring shame, and we're often tempted to go into debt instead of make a Christmas budget and financial plan. 

But I pray that our story encourages you because there is another way. Christmas isn't about money, it's about love. If you're trying to figure out how to celebrate the holidays with very little money, I hope and pray that you'll see it as a good thing. You can be the one who helps highlight what Christmas is really all about. 

Looking for an affordable gift?

My Advent Devotional, Unexpected, costs less than $10 and makes a great stocking stuffer and encouragement during the holidays.