How to Afford Christmas When Money is Tight

Fall is one of my favorite seasons and if you’re like me, you’re looking forward to football games, pumpkin everything and harvest festivals. Amidst all that fun though, how to afford Christmas starts to creep in to the back of your mind, because you know it’s coming. This makes fall the perfect time to start preparing for the holidays.

Back when money was tight for me (and even now), I’d start thinking about Christmas at the end of the summer because December can be a huge spending month and it’s best to prepare your finances accordingly.

The average person spends over $800 on Christmas stuff (gifts, parties, decorations, travel, etc.) each year and a lot of that total contributes to their overall debt. It’s terrible really when you think about it, to have a joyful holiday be the cause of mounting debt.

When you’re on a tight budget, one of the best things you can do to avoid all that is to start preparing for holiday expenses now with these tips.

Set Up Automatic Savings Transfers Now


Everyone knows when Christmas is, so you can start saving for it whenever you want. This is the best way to prepare so you can afford Christmas presents. When you have less wiggle room in your budget, the earlier you start saving, the better.

Set up automatic transfers from your checking account to your savings account to build up your holiday fund. You don’t have to start with a ton of money either. Setting aside $25 every two weeks is a great start.

I like to build a savings ladder for the holidays so I’ll start by saving $50 per month toward the end of the summer, then I’ll save $100 per month in the fall, and increase my contributions to $200 per month in November and December.

I’m hoping to use automatic savings transfers to save around $500 by December of this year. You can take this strategy even further by opening an account with a bank like Ally or Barclays Savings which both pay at least 1.15% interest and have no minimum balance requirement, allowing you to continue saving and earning on your savings, after the holidays.

Earn Cash Back


Earning cash back can be an effective way to boost your holiday savings after making regular purchases each week.

I have a cash back card with Citi that I use to earn rewards on regular purchases like groceries and gas. I don’t use the card for much else and pay the bill off in full each month. I’m hoping to earn about $50 – $75 in cash back by November so I can use it for Christmas. Here’s a list of similar cash back cards if you choose to go this route.

If you are afraid that having a credit card will be too great a temptation and you’ll end up falling back into debt, you should know that you don’t need a credit card to earn cash back.

You can also use Ebates which is a free site that pays you cash back when you shop online at popular retailers. If you make purchases on sites like Amazon, Target, Walmart, etc. be sure to use Ebates.

When you first sign up, you can earn $10 after making your first online purchase. They pay out quarterly and you can expect your next payment in November. Check out our Ebates review to see how they work.

Ebates is also great to use to help you save money on online purchases because the website helps you find relevant coupons you can use to apply during checkout along with free gift card offers.

Save Your Spare Change


Another way to afford Christmas when money is tight is to save up any spare change you come across.

If you’re able to cut expenses, treat the savings as ‘spare change’ and transfer it into your holiday savings fund. Perhaps you can cut your dining out budget, cancel any subscriptions you have and reduce your entertainment spending.

Remember, the changes you make don’t have to be permanent. If you need ideas of where you can save, here are 35+ ways to save money every month that can get you started.

Another easy way to literally save spare change is by using Qapital. Qapital is a cool free app that allows you to save spare change by setting up ‘If This, Then That’ rules.

For example, you can ask Qapital to round up what you spend on coffee in the morning and save it. So if your coffee ends up being $4.32, Qapital will save $0.68 for you once connected to your checking account.

It doesn’t sound like much, but it can really add up over the next few months if you allow Qapital to round up spare change from each purchase you make.

make Extra Money to help you afford christmas


With the summer winding down, now is the perfect time to kick your extra income efforts into high gear. See if you can work a few extra hours at your job. If there is an option to work overtime, try to pick up hours one day a week.

You can also get a side job. Seasonal jobs are very popular around this time of year and you can work at a retail store, fall festival on the weekends or choose another flexible side hustle.

Consider babysitting or dog walking on your days off.

If you have a car, you can start driving for Lyft or Uber. Both companies tend to give new drivers a generous sign on bonus after they complete a certain number of trips. That could provide you with plenty of money for your holiday fund.

There are many other ways you can make extra money before the holidays if you’re willing to think outside the box. Here’s a list of more than 30 ways you can make extra money before Christmas to give you some ideas of how to bring in extra cash.

Fail to Plan, Plan to Fail

Don't know how to afford Christmas because money is tight? Here are 5 ways to afford Christmas presents when on a limited budget.


That’s a saying I hear a lot of people make in regards to meal planning and nutrition. However, I think it’s a fitting piece of advice for many purposes including saving up for the expensive holiday season.

If you don’t start preparing now, you won’t have the money you need when Christmas rolls around and you’ll be stressed out and pressured to get into debt.

The holidays should be a pleasant time where you can relax and enjoy your family. You can keep it that way by doing some of these things to make the most wonderful time of the year more affordable even if you’re living paycheck-to-paycheck.


What do you do to budget for the holiday season? How much do you spend during the holidays? What are some other ways you’ve been able to afford Christmas when money is tight? 

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