How to build a holiday budget that works for you

Creating a budget specifically for the holidays can help you anticipate all of your upcoming expenses and plan for them accordingly. Use these steps to build your holiday budget so you can prioritize the things that matter to you most.

1. Make a list of all the people you plan to give a gift to this holiday. Also consider adding a few generic gifts in case you need something small for a last-minute get-together.
2. Write down all your holiday expenses. This may include things like gift wrap, cards, decorations and food and drinks. These expenses tend to increase significantly around this time of year, so it’s important to include them in your budget.
3. Determine the total amount you're comfortable spending on all the gifts and holiday items you listed. When deciding how much you’re going to spend, make sure the amount doesn't compromise your living expenses, the savings you've set aside for your long-term goals or your emergency fund.
4. Now that you've established the total amount you're comfortable spending, you can divide those funds across each of the gifts and holiday items on your list. This can help you make decisions about where you want to spend more of your budget and where you want to save.

It's possible to be generous yet frugal when gifting through the holidays. Here are some tips to help you stick to your budget:

• Plan ahead: If there's an expensive gift you'd really like to purchase for someone, start saving for it ahead of time.
• Stick to your list: Only buy the gifts you've listed for each person and avoid the temptation of buying items for yourself.
• Organize a gift exchange: Rather than purchasing a gift for each person at the holiday party, organize a gift exchange so each person is only responsible for buying one gift.
• Shop online to compare prices: Remember to factor in shipping fees before you buy and look for discount codes and coupons to save some additional money.
• Shop early: Shopping ahead of the holiday rush can help you avoid last-minute impulse purchases and gives you time to shop around and watch for a sale.
• Cash in your rewards: Uncover extra savings this time of year by taking advantage of your rewards and points programs. This may include using credit cards with cash back rewards or paying with points.
• Gift from the heart: Search online for easy homemade gift ideas like chocolate bark, baked goods and mason jars filled with holiday treats.

Gifts aren’t the only way to spread holiday cheer. More than anything, most of us want to spend quality time with those we care about. Here are a few ideas:

• Grab a warm beverage and take a walk outside, touring your local sights or admiring the festive light decorations.
• Attend a holiday market.
• Volunteer at a local charity or organize a large group donation.
• Partake in your favourite winter sport like skiing, skating, snowshoeing or tobogganing.
• Organize a potluck so everyone can contribute, rather than the entire meal falling to one person.
• Cook a holiday meal or bake a holiday dessert with friends or family.