Want to maximize you holiday budget this season? Here’s how to stay out of debt this Christmas and still give great gifts!

Picture it with me. The tree is lit with sparkling lights and glittery tinsel. The early morning hours cast shadows over the floor as the cheery celebratory light meets the darkness outside. Excited children squeeze their palms together in anxious anticipation. Piles of presents wrapped neatly in festive paper and tied smartly with perfectly coordinating bows flood the living room.

And then you see it. A gift so beautiful to behold you can hardly handle it – and it has your name it.

Without a second to lose, your fingers tear through the holiday adornments to get to the content inside. But instead of that perfect present, your heart sinks in despair as you realize you’ve found a hefty bill. The charges listed will require months, maybe even years, for you to pay. Disappointment spoils a seemingly perfect moment.

Maybe your credit card bill won’t arrive in such a dramatic fashion, but if you spend more money than you have in your bank account the feelings of frustration, disappointment, and financial exhaustion will be the same. But how can you keep your budget on track and resist the lure of pulling out plastic to pay for your Christmas purchases?

Stay Out of Debt this Christmas

Is a debt free Christmas even possible?

Of course it is!

Will you have to go all Laura Ingalls Wilder on your kids giving them only oranges and nickels this year?

Of course not!

Will your favorite traditions of baking cookies, being generous, decking the halls, and gift giving have to stop?

Not in the least.

It’s time we had a little chat about how to celebrate one of the best holidays of the year while still giving yourself the gift of financial peace all year long. It’s time we talk about five key ways to stay out of debt this Christmas.

Take a debt free pledge this Christmas to make smart money choices.

Take a Debt Free Pledge

If it’s not in writing, it won’t happen. Especially if you’ve struggled with overspending in the past, you need to promise yourself that you won’t end up in the same boat again. You need more than a mumbled vow or wishful thinking. In fact, studies show that writing your goals by hand yields a greater success rate. Post your Debt Free Christmas Pledge where you’ll see it frequently throughout the holiday season. Need some ideas on what your covenant should include? Check out the words I repeat to myself every year.

Sit down and create a budget for yourself this Christmas.


It’s no great mystery of the universe and I’m sure you groaned a little bit when you got to this portion of our time together. The absolute best way to get out of the debt and then stay out of debt is to manage your money well. To manage your money well, you must budget. I get it. Budgeting is the other “b” word in your world or it seems like a great mystery of ancient times. The formula for budgeting is straightforward and freeing, though. Simply put, budgeting is money in, money out. Take a deep breath and repeat after me.

Money in, money out.

So begin your journey by determining exactly how much you want to spend. This figure is directly determined by how much you have to spend. Don’t play tricks with your finances and pretend that you’ll discover a diamond mine or hit the lottery between now and December 31st. And please don’t depend upon Grandma’s yearly cash gift to pay off your credit card. Only work with the funds you have at hand. If you need a jumping off point for knowing which categories of spending you might encounter, check out these Seven FREE Printable Christmas Budget Forms.

Selling old books is a smart way to make extra cash around Christmas.

Scare Up Some Christmas Cash

What’s that you say? You just budgeted and you discovered you officially have $10 to spend on everyone and everything this Christmas? Never fear. There’s still some time to make some extra Christmas cash to bolster budget. Just remember you can’t count those dollars until they’re actually in your hand.
Here are a few of my favorite ways to make a little extra money during the holiday season:

  • Sell books, DVDs, games, and music on half.com or at Half Priced books. If you don’t think you’ll read the book again or loan it to a friend, it’s a perfect candidate to try to make some extra money.
  • Pick up seasonal work at a retailer. More stores than you can shake a stick at will be looking for associates and stocking employees. Find one near your home where you won’t be tempted to use your employee discount to spend your entire check.
  • Sell gold. Have broken jewelry? Take it to a Cash for Gold or independently own jewelry. Note: you may want to price what different locations might give to you.
  • Work Your Network. Furniture, toys, clothes, household goods, workout equipment, and more – your house is filled with inventory that someone else would love to purchase this holiday season. Take a few photos with your smartphone and post items on your personal feed or in the Facebook Marketplace.
  • Rock Your Rewards. Have you been collect rewards points all year long? Now’s the time to cash in those bad boys for gift cards that you can either give away or spend to purchase gifts. 7 Great Rewards Programs You Should be Using highlights some of my favorites!

Want a few more ideas? Check out 5 Ways to Make Christmas Cash.

Sit down and write out a list of gifts for each person.

Compose a Targeted, Defined Gift List

Gift giving can be haphazard at its best and hairy at its worst. Before you begin buying for every household on the block and purchasing gifts for each of your Facebook friends, take a minute to pause. You don’t have to buy a present for everyone you know. This might be your year to pull back and re-evaluate.

Does that mean you greet your nearest and dearest with an enthusiastic Ebeneezer Scrooge, “Bah, humbug!” grunt? Negative.

Think about ways you could spend time with those you love this year. Perhaps you could make memories by engaging in one of these 15 Christmas Service Projects for Families. Maybe you can share a meal with one another.

If you have children, consider defining the exact number of gifts you’ll give this year. Since they were born our girls have received three primary gifts each Christmas – a book, an article clothing, and an awesome toy. They also receive a stocking with smaller, practical items. No matter what guidelines you choose for your family, stick to them.

Limit credit card use around Christmas time to save money.

Leave Your Credit Card at Home

For years, I swore that my credit card was “just for emergencies.” After paying off over $127K in debt, I realized that no emergency happens in the aisle of Target. So if you’re not ready to go all Dave Ramsey on your card and clip it to smithereens, at least take it out of your wallet and leave it at home. If you’re tempted to shop online with it, have a very trusted friend or family member hold onto it for safekeeping. Or place it in a lockbox or other location that takes extra effort to use it.

We haven’t had a credit card since 2008. Even if you’re not ready to be that extreme, there are measures you can take to insure you won’t abuse your card.

You can do this. You can have a merry Christmas without the guilt gut in January. You can celebrate the season to its fullest and keep your finances in order. The practice of a debt free holiday season is quite perhaps the very best gift you can give yourself this year.

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Cherie Lowe
Cherie Lowe is an author, speaker and hope bringer. Her book Slaying the Debt Dragon details her family’s quest to eliminate over $127K in debt in just under four years. As her alter ego the Queen of Free, Cherie provides offbeat money saving tips and debt slaying inspiration on a daily basis.
Cherie Lowe


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