Frugal but festive: How to celebrate Christmas on a budget
You can still have a magical holiday season even if money is tight, with these wallet-friendly ideas for a frugal Christmas.
Christmas is a special time of year that is all about joy, togetherness and celebration – but it’s also a time Australians love to spend.
In the lead-up to last Christmas, Australians spent a record-breaking $74.5 billion, according to data by Australian Retailers Association in partnership with Westpac DataX.
However, with the cost of living crisis still battering household budgets across the country, many people are likely to be pulling back on spending big this year.
So, how do you create the Christmas magic while zipping up the wallet?
How to have a festive but frugal Christmas
Consider regifting presents
According to Easy Money author Joel Gibson, passing on an unused gift to others is becoming more accepted and will be a big thing for families this year.
“People are becoming quite comfortable receiving regifted gifts if it’s suitable for them,” Joel says.
“This is because people are much more comfortable with the idea of recycling and reusing in general.
“And a lot of people actually feel uncomfortable about the waste of Christmas.
“So if you’ve got something you were given last year that you’ve never used and you know somebody who might appreciate it, go for it.”
The key to a good regift is ensuring it will be liked — no one wants your trash.
Good regifting presents include unused household appliances, homewares, body creams, soaps, candles, jewellery and bottles of wine.
Wrap presents beautifully and add a heartfelt note to make it extra special.
Make a shopping list
Research shows shopping lists can help stop impulse purchasing and save us money.
So jot down what you need before hitting the shops.
“The more you plan and the better organised you are, the less you’ll have to spend,” Joel says.
Start your list early so you can take advantage of any deals.
Think about giving cash
To avoid spending too much, why not skip the shops this year altogether and instead gift cash?
“It’s a great idea because everyone’s happy to receive cash,” Joel says.
“People can spend it on something discretionary if they want to spoil themselves.
“But for some people who really need the money, it’ll help cover their latest energy bill and things like that.”
Avoid credit cards
No one wants to start the new year with a huge Christmas debt, so try not to use your credit cards or short-term finance options.
Finder senior editor and money expert Sarah Megginson says statistics show that in January, credit card debt is the highest for the whole year.
“And that’s because people end up spending so much at Christmas,” Sarah says.
“At the end of the day, people will not remember whether you spent $25 or $125 on that gift, so set a budget that’s right for you.”
A nifty trick is to buy $10 or $20 gift cards when you do your weekly shopping throughout the year and stash them away.
“The great thing about buying the actual gift cards is it kind of forces you to save, but it’s not money sitting there, so you’re not as tempted to spend it,” Sarah says.
Another approach is to limit presents.
For more significant family gatherings, arrange with the family to only buy kids’ presents or organise a Secret Santa with set price limits.
Make your own decorations
Christmas isn’t special without decorations, but creating a festive vibe is easy by making your own.
Involve the whole family in a fun DIY project, such as crafting paper snowflakes or making paper chains.
To add a rustic touch, get creative with natural elements like pinecones, branches and dried citrus slices.
Sarah says you don’t need to buy expensive items for your table setting.
Just use the napkins, cutlery and glasses you already have.
But, she adds, planning ahead is always the biggest hack of all.
“After Christmas, everything is 75 per cent off, so you can buy a beautiful matching Christmas set for next year.”
Share food costs
Hosting a Christmas lunch or dinner can be expensive, but with some planning you can still indulge without breaking the bank.
The first option is a potluck event, where everyone brings a plate.
“For a lot of people, food is their love language and they like to contribute,” Sarah says.
“You can still plan the menu — just designate the dishes to your guests.”
Joel adds you can save money by shopping around for the best deals, aided by supermarket catalogues listing specials.
“You’ll start seeing Christmas deals from mid to late November,” he says.
“So if you need a Christmas ham, you can see where it will be cheaper before you leave home.”
Use up gift cards
A survey by Finder reveals 39 per cent of Aussies have unused gift cards, with an average of $243 untouched on their cards.
The research, released in 2023, found 29 per cent of people had been unable to redeem a gift card — because it had expired, they had lost it or the company had gone out of business.
Sarah says Christmas is the ideal time to find your cards, check the balances and spend every dollar.
You could also use unused gift cards for regifting.
More budget-friendly ideas:
