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Christmas is a time of joy and happiness, but for some people it can also be a time of stress and anxiety.
If you are finding yourself in a situation where you can’t afford to buy Christmas gifts, don’t worry.
There are still plenty of things that you can do to make the holiday special.
In this blog post, I walk you through the steps to making sure you have money for Christmas as well as some unique ideas that will help you celebrate Christmas without breaking the bank.
Table of Contents
What To Do If You Can’t Afford Christmas Gifts
How To Survive Christmas With No Money
It is hard to get in the holiday spirit when you don’t have any money.
But it is important to know you are not alone, even though it may feel like it.
In fact, close to 40% of people are reducing the number of gift they are buying or are buying no gifts at all.
So if you are struggling financially this time of year, here are some steps you can take to help you still enjoy the Christmas season.
#1. Start Saving
No matter how close you are to Christmas, make it a point to try to save something for gifts.
Even if you can only put away $5, save it.
Anything you can save will help you to purchase gifts.
You can even look into ways to lower you monthly bills to help free up money too.
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I know saving $5 a week doesn’t sound like much, but when you start reading some of the frugal present ideas further down, you will see just how far you can stretch this small amount of money.
#2. Get A Side Hustle
Another option you might consider is taking on a side hustle to earn some extra cash.
The money you earn can be strictly used for buying gifts.
And the good news is there are an endless amount of side gigs to choose from.
You could drive for Uber, grocery shop for Instacart, you could even sell your body to make extra cash.
The bottom line is, you can work a side hustle during your free time and bring in the income you need to buy gifts.
#3. Prioritize Your List
Now that you have money coming in or are saving a little bit, it is time to review your list.
Write down all the people you want to buy for and then prioritize the list.
At the top should be the most important people, family members like your partner, your kids, close relatives, etc.
Further down the list should be other relatives, co-workers, some friends, etc.
Once you have your list ordered, it is time to review it.
Look specifically at the people at the end of your list.
Is it an issue if you simply don’t buy them gifts?
The reality is, most adults do not expect a gift.
A simple card would just fine.
And young kids you rarely see might be upset in the moment, but aren’t going to remember you didn’t buy them a gift.
So look at your list and make note of everyone who you can skip buying presents for.
#4. Be Realistic
Now that you have your list of people you do need to buy for, it is time to get real.
The reality is you can’t afford to buy expensive gifts for everyone.
And you probably can’t buy multiple gifts for everyone either.
While you might know this in the back of your mind, it is important that you take a few minutes to really think about it and accept it.
If you don’t, you might get caught up in the spirit of the season and just buy, not thinking your purchases through.
The result will be you in a mountain of credit card debt, which is only going to make your financial life that much harder since you will have yet another bill to pay every month.
#5. Set Up A Christmas Budget
Your next step is to set up a budget for gifts.
As mentioned above, if you don’t do this, you will end up in credit card debt.
And in the moment, you might not think this is a big deal.
But if you are struggling financially, adding the burden of holiday debt is only going to add more stress to your life.
So set up a holiday budget amount you want to spend for each person.
Maybe that amount is $10 per person.
Maybe it is $25.
You have to look over your financial situation, see how much money you can save and earn and determine the gift amount that makes the most sense for you.
#6. Be Honest
Finally, if money is so tight that you simply can’t follow these tips and have zero money for gifts, you need to be honest with your loved ones.
Sit down and explain that you are having a tough year financially and you won’t be able to give the number of gifts like you had in the past.
Adults will sympathize with you and understand.
Kids on the other hand might have a tougher time with this one.
When speaking to them, make you don’t say that you can’t afford Christmas presents.
This makes them have a scarcity mindset with money and you don’t want to do this.
Instead, say that gifts aren’t in the budget this year.
It is critical they don’t think they did anything wrong, especially if they are young and still believe in Santa Claus.
Frugal Christmas Gift Ideas
Now that you know what to do if you find yourself saying ‘I can’t afford Christmas gifts’, it is time to look at some creative gift ideas to help you still enjoy the holiday season.
#1. Get Creative
You’ve heard the old saying about it’s the thought that counts.
Well now is your opportunity to put it to the test.
Start thinking about how you can give a gift to a loved one without breaking the bank.
Maybe you have a friend who loves to cook.
You could find a recipe, buy the items to make it, and plan a date to cook together.
For your partner, you could give a coupon book that offers a free massage from you, or a night off from the kids, etc.
Just spend a little time thinking about what that person enjoys and then think about how you can offer that in a low cost or free way.
And here is a bonus tip.
Don’t get frustrated if you can’t think of a great gift idea.
Many times I tried thinking of something creative only to come up empty.
But then a few hours later or the next day when I am doing something completely different, the idea will magically pop into my mind.
Finally, consider skipping the Christmas card.
Most people do a quick read and throw the card in the trash.
Save yourself the money and put it towards gifts instead.
If you insist on cards, make your own.
#2. Skip Gift Giving
This one is mostly for the people down at the bottom of your list that you aren’t buying holiday gifts for.
But there is no reason why you can’t use it for others on your list too, assuming you can’t afford any gifts at all.
Here, you skip gifts entirely and do find things instead.
For example, maybe you host a potluck dinner with your friends around the holidays.
Many people do this around Thanksgiving and call it Friendsgiving.
Simply have everyone bring a dish and sit and enjoy each other’s company.
Another option would be to have a movie marathon or play games.
You could even pile into a car and drive around looking at holiday lights, go sledding, volunteer together, or go to a parade or carnival.
The point is, there are a lot of things you can do that cost little or no money that will still make memories with the people you care about.
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#3. Celebrate Late
If you think that your money situation is only a temporary one, you could celebrate late.
The key here is to be honest with people about your finances and that you plan to celebrate late.
Of course, you need to make sure that you will be able to afford gifts in this case.
The last thing you want to do is set the expectation that gifts are coming and then not follow through.
In fact, I would caution about using this one.
The reason is because I’ve seen many people, including myself, mentally spend money we didn’t have yet.
For me, it was a tax refund I was planning on getting.
I always got a refund so when I gave my files to my accountant, I was dreaming of the things I was going to buy with my refund.
I got so caught up in the moment, I bought the things using my credit card, thinking I would just pay off the debt when my refund came.
Sadly, I didn’t get a refund that year.
Now I was in credit card debt I had to repay.
For a friend, something similar happened.
He did get a refund, but when his came, his hot water heater failed at the same time, so the refund went towards that and he too was in credit card debt.
The point is, only offer to celebrate late if you know for certain you will be able to.
#4. Shop At Thrift Stores
Now we start getting into ideas that will stretch your dollar the furthest.
The first place to consider buying gifts from is the thrift store.
Here you can get clothing, books, even some artwork or household items for a really good price.
And since most people make donations at the end of the year so they get a tax deduction, you might be pleasantly surprised with how much you can buy here.
For example, if you have a budget of $25 per person, you can buy a couple pairs of pants and a few shirts for that amount of money.
If the thrift store doesn’t have what you want, maybe Facebook Marketplace does.
You can find a lot of high quality used goods at great prices and is something to consider.
#5. Make Homemade Gifts
Another option to consider when it comes to cheap Christmas gifts is to make handmade items.
Are you good at working with wood?
Can you paint?
Maybe knit or sew?
These free gifts can go a long way in not only stretching your holiday spending budget, but also be something the other person will always cherish.
#6. Save Money Shopping
If you aren’t able to make handmade gifts, the perfect gift can still be had for less.
A great way is to consider shopping at dollar stores.
While the selection isn’t great, they do have a lot of items, including greeting cards, gift bags, and wrapping paper.
I remember one year a distant relative got me dress socks from the dollar store.
It just so happened that year I needed more socks and this was the perfect gift as it saved me from having to buy them myself.
In addition to dollar stores, you can still do your holiday shopping at traditional retail stores as well.
The catch here is getting the absolute best price.
You do this by researching a few places to see who has the lowest price.
Then you buy from there and add coupons into the mix.
If you shop online, this is easy as you can shop through Rakuten to earn cash back.
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Even better if you use a cash back credit card, in which case you get to double dip.
Finally, don’t be afraid to ask for discounts when you shop in person.
Ask if the cashier has any coupons they can apply to your purchase or if you can get a discount for paying with cash.
More often than not, there will be some discount that can be applied, saving you money.
#7. Contact Salvation Army
You see the red kettles all over the place around the holidays.
If you have kids and can’t afford Christmas, reach out to your local Salvation Army.
As long as you can prove you are low income and need help, they will provide a gift for your child.
The only catch to this idea is people tend to start signing up in October, so the early you do this, the better.
Otherwise, you run the risk of them not being able to help.
#8. Reach Out To Your Local Church
Another option to consider is your local church.
Many have present drives where they collect items from their members and give the presents to families in need.
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Sometimes they will even adopt low-income families and buy gifts for the entire family.
So reach out to your church and explain your situation.
Even if they don’t have a holiday drive, chances are they will know of other local charities or other churches that do.
#9. Join Santa’s Little Helpers
The Reddit community has a program called Santa’s Little Helpers that helps the less fortunate enjoy the holidays.
They limit the dollar amount of the gifts and in some cases, you do need to show proof of your need.
The key with this one as with the Salvation Army, is to register early so you ensure you are on the list.
For this option, registration usually opens in early November.
#10. Spend Quality Time With People
Finally, don’t overlook the power of simply spending time with someone.
They say that most people value experiences over things, so instead of focusing on things to buy, think about experiences you can have.
This doesn’t mean if a loved one wants to travel around the world, you need to save up $10,000 and buy them tickets.
Instead, maybe you find a YouTube channel that documented their around the world trip.
Or you might sit down together to research and plan their trip with them.
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If you have a loved one who enjoys music, find free holiday concerts in your area and go together.
The point is, by spending time with someone, you develop a deeper connection with them, and this connection lasts longer and is stronger than any gift you can buy.
How To Afford Christmas Gifts Going Forward
Now that you have some ways to enjoy Christmas this year, you need to make sure you never are in this situation again.
The good news is there is a simple thing you can do and it is to start saving early.
Don’t wait until November to start saving for the holidays.
Start in January.
Take $20 from each paycheck and put it into a separate savings account that is only for presents.
If you get paid every other week, saving $20 each time gives you over $500 for gifts.
You can always save more if you need to, or you can find a side hustle to bring in some extra money.
And if you have a tight budget, work to free up some cash so you not only can save for the holidays, but also improve your entire financial life too.
What Not To Do When You Don’t Have Enough Money For Gifts
If you don’t have a lot of money for gifts, the worst thing can you do is go into debt just to buy gifts.
You do this either by spending with credit cards or taking out a personal loan.
By going into debt, you just make things that much worse for yourself.
You now have to repay the debt and you have the shame of knowing you couldn’t afford Christmas gifts but still buying them hanging over your head.
Follow the tips outlined above the still enjoy the holidays.
Reach out to a local charity for help, as this is why they exist.
Consider telling your loved ones money is tight and you are taking simple gift requests this year.
Anything is better than going into debt.
There is what to do if you can’t afford Christmas.
I’ll be the first to admit, this is not the most enjoyable situation to be in.
But you can’t allow yourself to get down and think that there won’t be a Christmas this year.
You can still put some money aside and by thinking outside the box, you can still make the best of the situation and make memories that can last forever.
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I have over 15 years experience in the financial services industry and 20 years investing in the stock market. I have both my undergrad and graduate degrees in Finance, and am FINRA Series 65 licensed and have a Certificate in Financial Planning.
Visit my About Me page to learn more about me and why I am your trusted personal finance expert.