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Money tight? 6 money-saving tips to help you do Christmas on a budget

Nov 7, 2023 | Money tips, Whānau

For most of New Zealand, Christmas is a time of getting together and celebrating with whānau and friends. There’s much to look forward to, especially for children: Christmas lights, decorations and other sparkly things, gifts, hearty meals, and special traditions.
All these things bring with them a wonderful sense of festivity and fun…

But if money is tight, instead of sparking joy the lead-up to Christmas can be a harsh reminder of your financial position. Around 40% of New Zealanders have less than $1000 in savings [1]. And it’s common for adults to associate Christmas with financial anxiety.

If this is you, the CAP team have put together some money tips to take the pressure off! These tips come from former CAP clients, Debt Coaches and budget advisors who know what it takes to make your money go further…  and who know that the best treasures don’t necessarily cost money!

The original Christmas family

The original family in the Christmas story struggled in the lead up to the day of Jesus’ birth too. Joseph and Mary set off for Bethlehem taking only what they could carry. It was a 145km journey, at times across a scorching desert. Mary was heavily pregnant – and travelling on a donkey. Ouch.

Like us at times, they didn’t necessarily know the best way to go, or whether they’d make it in time. It must have been a huge relief when they saw the candle lights of Bethlehem on the horizon, but even then, they didn’t know where they were staying.

It was a faith journey. And an ironic one. Jesus, the King of Kings, ended up being born in a humble stable, and laid down to sleep in a feeding trough lined with hay.     

So, if you feel like you’re trudging through a desert in the countdown to Christmas, you’re not alone. You’re in some good company.

So how can you save yourself money and stress at Christmas?

👉1. Have an honest conversation

Start by having an open kōrero/conversation with your family/extended family and friends. With an increased cost of living, it’s understandable that gifts may not be affordable this year.

Write a list in priority order of who to give gifts to. Are there adults you could ask whether they would mind not doing gifts this year? Have a prepared response for when you’re talking about your price limit on gifts, for example “I’m sorry, that’s not in my budget this year.”

The tried-and-true practice of Secret Santa doesn’t just have to be for kids, and it’s especially helpful for people with large families. “We do a secret Santa for the cousins on both sides of the whānau,” says Debt Coach Villette.

“We buy three presents only for each side of the family (as opposed to 22 presents for one side and eight for the other!). The budget is fairly decent, so the cuzzies get something worthwhile that won’t be tossed post-Christmas Day.

If we’re feeling like we have the budget and end up doing pressies for each family – it’s always a holiday food hamper, a very practical gift the family can enjoy.” — Villette, CAP Debt Coach

Likewise, potluck dinners don’t just work for community events, they’re a simple way to share the Christmas food bill. If you’re hosting the main meal, you can still ask people to bring a plate, or even two. This seems to be a culturally acceptable practice for most New Zealand families.

In terms of honest conversations, sometimes the most important one to have is one with yourself. Debt-free CAP client Tina, from Tasman, recalls a moment when she reminded herself that her kids aren’t materialistic, and that quality time is more important for them.

“I had to learn that and say to myself that it’s okay, that they don’t have all the presents that you’d want to get them.” — Tina

👉2. Your presence over presents

Remember Christmas is all about people, and cutting costs doesn’t mean you have to sacrifice quality time with people you love.

You can turn that quality time into a physical gift by giving a home-made voucher promising a walk, coffee, frozen yoghurt, etc. This could be in the New Year if money (and time) is scarce in December.

If your kids are young, Villette suggests a simple way to help them learn that Christmas isn’t all about gifts is to celebrate Jesus’ birthday.

“My wider whānau would have a birthday cake for Jesus on Christmas Day. We would read the Christmas story to them and talk about His birth, and then sing happy birthday and blow out the candles for Jesus, so the kids understood who we were celebrating.” — Villette, CAP Debt Coach

Debt-free CAP clients Mark and Carol, from South Canterbury, also noticed Christmas changed for them after they began with CAP. Not only did they receive a tailor-made budget that helped them afford a few presents for their kids, their understanding of the meaning of Christmas changed, as they discovered a closer relationship with Jesus.

“Christmas has got such a wonderful meaning behind it now – the birth of our Jesus. What could be better than that?” — Mark, Debt Free CAP Client

👉 3. Plan ahead

If there’s no time left to save for this Christmas, set yourself a reminder – in your diary, or on your calendar – for a date next year which would be realistic for you to start putting aside an amount each payday. You could open a new account – most banks allow you to do this online, or on their app – and label the account something like ‘Christmas savings.’

Debt-free CAP client Rose, from Auckland, found a simple way to prepare for the Christmas grocery bill was to put aside a little bit here and there when she did her weekly shop.

“I joined PAK’nSAVE Christmas Club – as a way to save for Christmas food throughout the year.” — Rose

CAP CEO Sam Garaway recommends ensuring that you have a goal in mind — whether your desired future state of finances next Christmas is small or large — as this is an anchor for helping make sure that you stick to the plan.

“Setting goals allows for a sense of progress, achievement, and builds motivation to stick to the plan. Being able to articulate what state you want to see your finances in at Christmas will help in navigating decisions, and prioritising. And it can encourage you when the squeeze is on.” — Sam, CAP NZ

Doing a free CAP Money course is a great way to help reach your goals. Over 18,000 New Zealanders like Mark and Carol have taken this course.

Free Download — Worksheet to cut back and save money.

👉 4. Make it at home

Make your own Christmas decorations using cardboard, glue and tin foil. Cut out shapes such as stars and baubles and add coloured ribbon. Or use twine/string for more of a rustic look.

Use your creativity – or your child’s – by making DIY wrapping paper and gift tags:🌟

  • Keep brown paper bags e.g. from the supermarket and decorate as gift bags.
  • Buy a roll of brown paper and decorate using pens or paint.
  • Make gift tags using cardboard and ribbon or string.
  • Use the kids’ artwork (with their permission!) as wrapping paper.

Make your own treats or tree decorations to give as gifts. Keep glass jars (such as from peanut butter) throughout the year, remove the label, wash and dry well and fill them with your treats to give as gifts.

If you can’t make it, fake it! For example, if a Christmas tree blows the budget, you could try these ideas:🎄

  • Decorate an indoor pot plant instead, if you have one.
  • Do you have a tree in your garden you could safely trim a branch off? Pop it in a bucket of water and decorate.
  • Visit a local Christmas tree farm and ask for any offcut branches. These can be used to make real pine wreaths to decorate your front door or dinner table.
  • Check with local Christmas tree farms to see if they have any trees going half-price due to imperfections.

👉 5. Make your gifts count

When it comes to buying for your own children, former CAP client Rose recommends buying items they actually need anyway, like clothes, especially as they get older.

Villette agrees.

“My teenagers get a certain amount of money and often what they’ll do is go on a shopping spree in one of the sales leading up to Christmas. It’s the one time of the year they get to go shopping and buy some the things they’ve had their eye on all year. It normally looks like clothes and some gaming/headphones paraphernalia, and I take them and  wrap them up for the 25th.” – Villette, CAP Debt Coach

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👉 6. Make room for others

When Mary and Joseph finally arrived in Bethlehem on that “silent, holy night” 2000 years ago, the town was incredibly busy, and all the inns were already full. Thankfully, they met an innkeeper who let them stay in their stable.

How can you accommodate others with small acts of generosity this Christmas? Sometimes performing an act of kindness or generosity can completely flip your perspective on your own situation, and you realise that bringing joy to others can be more rewarding than receiving something for yourself.

CAP Budget Adviser Emily has a tradition she and her husband have done with their kids, that has helped them think about others at Christmas time. “It is meaningful and also free!”

She suggests shifting your kids’ focus from getting to giving during the Advent season by inviting them to do one or all of the following challenges:

  • Write a message of hope. Make a Christmas card (or choose a ready-made one) and write an encouraging message for someone you think doesn’t often receive encouragement.
  • Make a donation of pocket money to a charity’s Christmas appeal.
  • Give away a precious pre-loved item to an op shop.
  • Do a random act of kindness for someone other than a friend or family member.

Afterwards, talk with your kids about how it felt to do the challenge and how it was received – you can link the experience to the message of Christmas.

Former CAP client Tina has used a similar approach with her own family/whānau:

 “My kids would choose one, two, or three (maximum) people that have supported, inspired, or encouraged them throughout the year – just whoever was placed on their heart and mind. They would go and buy gifts with an [agreed upon] amount of money. And then on Christmas Day we’d go around and give the presents to them, and then just tell them how much they appreciate them.” — Tina, CAP client

The CAP team sincerely hopes these tips help you stay financially resilient as you juggle festivities and finances in the lead-up to Christmas Day.

Remember if you need free help, visit: CAP Debt Help or try a CAP Money course.

And if you want to ensure CAP’s  free help is available to more New Zealanders in hardship, feel free to make a donation.


[1] Source: FinCap. FinCap is the organisation responsible for working with financial mentoring services in New Zealand.