How We Save for Christmas

Today Aaron and I were talking about our family budget for when we go home. We have to make lots of big purchases so we have saved the past three years so we can pay cash for everything when we go home and won’t have any debt past our mortgage and car payment. So I thought this week I would share how we budget for Christmas.

The Rosie Diary- How to Save For Christmas pinterest.png

I’m sure you have seen tons of ideas on Facebook and Pinterest on how to save. One has you save a $1 the first week, $2 the next and each week it goes up. Another you save $1 on Monday, $2, Tuesday, $3 Wednesday, $4 Thursday and so on for the year. Or even a 12-week savings challenge, so you have money just in the nick of time. Mine will have you saving just a little each paycheck over the year and help not have any debt for Christmas.

When I was a kid, my mom and dad taught me to automatically put 20% of my paycheck in savings so I could have it there for a rainy day. I wasn’t always good at doing that, but when we had Dominic, I knew that I didn’t want to be in debt for Christmas, so I started saving at the beginning for the year. Thanks to my dad, I have always done my banking electronically. The last time I went inside of a bank was to get cashiers check to put a down payment on our house. Nowadays, online banking is even better. So here is the breakdown of what I do.

Set a Budget

The first thing you need to do is determine how much you want to spend for Christmas. Christmas has to be my favorite holiday of the year and I know I tend to want to go overboard, and we did a few times, but then we realized that that is not what we wanted to do anymore and save more for vacations, so we set a budget of $1,500 for Christmas.  So you need to figure out what your budget is first!

Once you set your budget, determine how many times you get paid a year. I get paid bi-weekly, so that is 26 pay periods in a year. If you are bi-monthly that would be 24, and so on. Now that you know your budget know the number of pay periods you have in a year, it’s time to figure out how much from each paycheck you need to take out towards your Christmas goal! So now to do the math:

Paid Bi-Weekly:  $1,500/26 = $57.69

Paid Bi-Monthly: $1,500/24 =  $62.50

Set Up Automatic Transfers

I like to have nice even numbers, so I always round up. The net step is to set up a savings account with your bank. I do this because it makes it easy to have it one place, you’re not tempted to borrow cash from your stash,  you get to watch it grow over time, and the most important reason is you automatically transfer it each pay period! Automatically transferring it is the most important part because this is where I see people fail. If they are trying to save it in cash in an envelope, they forget to go to the ATM or forget to do it a pay period and then they have to catch up. But once you set the transfer, it automatically goes to the appropriate account, and you don’t have to worry about manually doing it, and it just comes out, so you don’t see it in your checking but see your savings account go up each pay period. So here is a breakdown of how it will add up for the year!

Pay Day

Amount From Pay Check Balance
























































$60.00 $1,140.00
















11-Dec $60.00


25-Dec $60.00


So that’s our secret sauce! The good news is it’s not too late to start! And the great thing about thinking to save this way is you can use it for anything! Want to save for a vacation? Have a special event you know is coming up that you want to pay for? Even your kid’s college tuition from the time they are born. We have saved this way for years, and it works! Would love to hear what you think and how you are saving for Christmas or a specific goal too! Share in the comments below.

3 thoughts on “How We Save for Christmas

  1. lexusnext says:

    Great post Rosie!! I do this too, in fact I love Capital One 360 Savings because you can have Multiple savings accounts (I think it’s around 15 or something). You can set up a goal for each and it tracks with a nice little bar graph for those that like a visual. I’m currently using it for a vacation find, moving fund, and Alianna’s savings. And it actually gets pretty good interest which is nice added bonus. I do automatic transfers and never even notice anymore which is a better savings plan for me.


  2. lexusnext says:

    My main account for day to day and savings is with BOA but I didn’t like their fees on smaller balance accounts. So I use capital One for those types of accounts and it’s worked out really well so far.


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