How to Save for Christmas…in July!

Can you believe it’s already July?! I know that some people felt that the last few months dragged because of everything being shut down due to the pandemic and being quarantined, but for me days ran together. It just seems like June flew by, and now 2020 is officially more than halfway over.

Christmas in July?

I know it’s summer and many of us aren’t even starting to think about Christmas and the holiday season at all. (Unless we come across a Christmas in July sale) However, one tidbit that I learned to do quite a few years ago was to start making small financial adjustments ahead of the holidays in order to avoid being caught off guard and unprepared with spending when December rolls around. I remember putting nearly $1,000 on a credit card one Christmas and then taking four months to pay it off- with interest! So the next year, I figured out some changes I needed to make so that I could avoid a repeat of that situation in the coming years.

Save Ahead of Time

Instead of paying off a credit card for months at a time, I decided to do the opposite and start saving months ahead of time. I figured starting in July would be best because it gives me six months to save. What I did was I made a small goal for myself to put aside $50-$100 each pay. I was getting paid bi-weekly, so I figured that’s anywhere from $100-$200/month that I could stash for Christmas. I couldn’t believe how fast I saw my savings build up each month! I have been doing this every year since. By doing this, when December rolls around, whether I decide to use my credit card (gotta love accumulating rewards points), or just use my savings; I have anywhere from $600-$1,200 already set aside for purchasing gifts! **

Save for other events too!

It’s a simple adjustment that ends up worth a lot by the holidays. Although I use this method to save for Christmas, it can also be used to save for summer vacations or big events where you may need more than a little cash on hand.  Whether you’re going on a trip, or wanting to buy yourself something special; using this method can help you put some money away in a fashion that helps you see how much you’re saving, but you’re not missing out on the money or wanting to spend it right away.

Why it works

I know some of us live paycheck to paycheck, so to even think about putting aside $50/pay seems unrealistic. The trick is to put the money aside as soon as you get paid, so you aren’t even thinking about using it for something else. Take it out of the bank, move it to a separate account, or give it to someone trustworthy to hang on to for you. You can’t miss the money if you move it right away and you aren’t looking at it in your bank account.  I was working a minimum wage job when I started this, so I’m telling you it is possible. Whether you cut back on buying a Dunkin or Starbucks every day, or you skip out on those Instagram ads that you keep buying new stuff from; you won’t even miss the money that you’ll be setting aside.  If it seems too overwhelming, just start with $25/pay to see if it’s manageable. Any amount can add up and be helpful come time for the holiday season.

I hope that you take advantage of this tip and start saving now!

**Disclaimer: I am in no way a financial expert or soliciting any type of financial plan, saving account types, or any type of investment. This is just what has worked for me in my personal experience.