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Why It is Best to Start Saving For Your Christmas Expenses in January

Last Updated on October 14, 2021 by Rat Race Running

The Philippines is dubbed as the country with the longest Christmas, and it is easy to understand why. Filipinos love to celebrate this season.

However, people also spend more during this season than at any other time of the year. Well, maybe aside from school fees and unexpected emergencies.

With the companies mandated by law to give out 13th Month Pay to their employees, it is usually spent during the holiday season until almost nothing is left.

But what if you could use your 13th Month Pay and other bonuses for other things, instead of the usual holiday expenses by doing one thing.

Paradigm Shift on Holiday Expenses

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The Christmas season is not a surprise event. It happens every December, and most of the expenses are also almost predictable.

You know how many people you’ll give gifts to, including your godchildren, friends, nieces and nephews, and others. 

You also know a rough estimate of how much to spend on food that you’ll prepare, videoke rentals, and even the Christmas party celebrations. 

So, since it is expected to come by the end-of-year, you can easily prepare for it as early as January. Doing so will leave your 13th-month pay intact for other more important expenses, savings, or investments.

Here is a simple computation:

  • If you save P1,000 from January to December, you’ll have P12,000 by Christmas.
  • If you save P500 from January to December, you’ll have P6,000 by Christmas.

The goal here is to consistently save a fixed amount from January until December, so a larger part of your 13th-month pay and bonuses will remain intact for other goal-related expenses.

What not to do with your Christmas Savings?

As its name implies, the Christmas savings are supposed to be used for your Christmas expenses.

It should not be used in case of an emergency because you should have a separate emergency fund.

It should not be used for tuition fees because you should also have a separate tuition fee fund.

And most importantly, it should not be used to buy big-ticket items such as a new laptop, cellphone, or appliance. Because you should have a separate guilt-free spending fund.

How I Budget for Christmas:

I don’t have a specific Christmas budget, but I have a “Special Occasions Fund.”

I made a pooled fund where I include my birthday expenses, a gift-giving fund for birthdays and other celebrations, and of course, a Christmas fund.

By consolidating special occasions expenses to a single budget category, it makes budgeting simpler.

However, it is also essential to have the proper mindset and discipline to properly allocate the appropriate fund to each expense.

Final Thought:

In the last six years since I started working, I made sure to stick to my budget until it hurts.

I believe that we will always deprive ourselves of certain things. It is not a matter of if, but a matter of when.

So, with all your expenses last Christmas 2020, I hope you will consider saving as early as your first paycheck for your Christmas expenses.

Hopefully, after the holiday season of 2021, you will no longer ask yourself what happened to your bonuses last December and maybe give a little thanks for this post. 🙂

Let me greet you a Merry Christmas and a Happy New Year, twelve months in advance.


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