How to Create a Magical Christmas on a Small Budget

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Christmas on a budget? You have come to the right place. I grew up in a large family and money was always tight, and sometimes even non-existent. My mother, even in the midst of their biggest financial trials, always made Christmas a magical experience. She always strived to keep our focus on the Savior, and away from the commercial side of Christmas.

Almost all of my fondest memories of Christmas as a child center around the things we did together more than the gifts we received. Money is not required for making a truly magical Christmas. In fact, those can be the most memorable Christmas ever!

Hence, the reason why I decided to write this post. Thoughts of my childhood have been with me lately, and I felt like I should share in hopes that someone else might benefit from our hardships and joys.

Is your Christmas budget a little tighter this year? Count yourself blessed! This may be the most memorable year your family will ever have!

How to Create a Magical Christmas on a Small Budget

#1 – TIME

 If there is one thing I have learned more than anything else, it is that my children would rather have time with me than almost anything else. The gift of time spent with a child will reap rewards that will pay you back for the rest of your life!

Money spent on fancy toys is fun and exciting, but eventually the excitement fades away and is replaced with new desires for something else. Memories last forever.

#2 – Don’t be too prideful to accept whatever comes your way

 I remember one year, we didn’t even have enough money to buy a tree. My mom felt bad about it, but was driving through a parking lot one day and saw a perfectly good tree that had been thrown into a dumpster behind a store.

She brought it home and that was our tree that year, and it was beautiful. Miracles happen to those who have faith and aren’t afraid to look.

#3 – Christmas ornaments

 My prettiest tree was the tree my sister decorated when she was living with us while I was pregnant with our 3rd child. I was too sick to think or even care about a tree that year and she was determined to make our home festive for the holidays. She gathered what meager ornaments she could find and then strung popcorn with the kids.

It was my kid’s favorite because they had helped and I thought it actually looked quite nice! My mother has found a beautiful, yet simple way to decorate her tree every year now. She calls it her “Christ tree.” What she does is buy the thick single baseball card holders, then she finds her favorite pictures of Christ and cuts them to fit inside.

Decorates the outside with ribbon and glue, hole punches the top, and hangs them on her tree. She makes these for the grandkids every year and writes a note and the year on the back. I have really come to treasure these every year!

You could even have kids put in pictures of their favorite moments throughout the year, then save them for when they’re older to cherish. For a simple tutorial, read this post: Simple and Easy Christ Centered ornaments.

DIY Simple and Easy Christ Centered Ornaments

If you have kids, ornaments can be kept very simple and homemade. It’s the actual process of decorating the tree that is special to them, not what it looks like after.

#4 – Gifts for Children

 Ever notice that by the time Christmas rolls around again, all the toys you bought for your children last year are either lost or no longer played with? This is a great time to give them away or sell them. You can sell them online, at Kid to Kid, or just donate them to your local thrift store.

Last year, I was able to buy my baby’s toys at our local thrift store for under $30 and I got MORE than what he ever would have needed, and most of them still had batteries that worked. He no longer has any interest in them so I will most likely box them up and sell them online, then repeat the same process as last year.

If you’re worried about buying used stuff, you can just sanitize them. I took sanitizing wipes and wiped all of the toys down before I ever gave them to my kids.

My kids also like to give gifts to each other so sometimes we draw names and then make something for each other or they earn money doing chores and we make a dollar store run and let the kids pick out gifts for each other.

They learn how to give, and it costs very little. If you’re looking for simple, cheap ideas for your kids stockings, check out this post:  Stocking ideas for kids from toddlers to teensThese are great ideas for a wide age range. Finally, stocking stuffer ideas for all of my kids all in one place!

#5 – Gifts for Spouses

 Wondering what to give your spouse when the budget is small? Check out this idea . She has some very creative ideas for doing a stocking exchange with your spouse for little to no money. You can find it here:

Creative ideas for exchanging Christmas stockings with your spouseThese Christmas Stocking themes are so creative and fun! I CAN'T WAIT!!!

Do this stocking exchange and create a coupon book for free services like a batch of cookies, a massage, candle light dinner, etc. These experiences you share together with become great memories that will last forever! 

#6 – Neighbor Gifts

 I’m just gonna say it. I love my neighbors, in fact I live in one of the most awesome cul-de-sacs there is. My neighbors know I love them and we are all very frugal with our neighbor gifts every Christmas. It’s the thought that counts, not how much you spend.

I found some really cute, funny, and frugal ideas for Christmas Neighbor Gifts. You can find them in my post here:

20 of the BEST Creative and Cheap Neighbor Gifts for ChristmasWondering what to by the neighbors this year that's cute, creative and won't bust your budget? I got you covered!

#7 – Take advantage of cash back opportunities

 Always take advantage of cash back for any online purchases you make. I love  EBATES for this because it’s as simple as signing up for an account and then just going through their site to your favorite shopping sites. Then, whatever you buy, they give you cash back. Plus, they give you a cash bonus when you first sign up.


You’d be surprised at how fast it builds up! Also, after you sign up, make sure you install the Ebates bookmark button to your search bar so that you get reminders every time you are on a site that is eligible for cash back. Before I did this, I would always forget and miss out on my cash back.

#8 – Start New Traditions

Low on money? Perfect time to start new traditions! Set up a tent in the living room and camp by the Christmas tree, do a crazy, cooky white elephant exchange with your family, wrap up 25 Christmas stories and read one every night. If you want some more great ideas for Christmas traditions, you can read a post I wrote with more ideas:

Simple Christmas Eve Traditions to Start with Your Family

#9 – Bake Holiday Treats – 

I have fond memories of making Christmas treats during the holidays. If you make them from scratch and allow your kids to help, it can be a memorable experience that costs very little. If you struggle with baking with kids because of the required patience and the extra messes and spills, you might enjoy my post, Baking with Kids.Want to have fun baking with kids, but you're afraid of the messy chaos? Take a deep breath! You can do this!

 Also, if you’re looking for some kid-friendly, easy Christmas treats to make, I got you covered! Here are 25!christmas treats for kids


#10 – Acts of Service.

I still remember the year when my family lived in Missouri. My dad was running a small Radio Shack, which he thought would be promising, but ended up failing and we were “up a creek without a paddle” financially. We knew there would most likely be no presents that year.

I will never forget when the knock at the door came, and in flowed members from our local church with arms full of food. They quickly and quietly loaded our shelves and fridge with food and then cheerfully went their way.

It touched my heart forever and I hope and pray, even over 20 years later, that they were blessed tremendously for the act of service they bestowed upon my family that day.

Since then I have had many opportunities to give service to others and have also received service from many kind friends. Teach your children to serve others and to be Christlike to others. The world today is full of people who feel entitled, selfish, and greedy. It’s up to us to raise a different generation.

Honestly, I think a lot of us parents are so afraid of disappointing our kids at Christmas if we don’t have the right number of gifts under the tree, or the exact thing they’ve asked santa for. I, myself, struggle with this every year.

Children, follow our lead. If we are stressed, so are they; if we are sad, and obviously carrying a financial burden, they notice and can feel it.

My mom remembers when I was little and overheard them stressing over money and mortgage payments. I quickly filled a plastic bucket with all the pennies I could find and wrote a note to them telling them they could use my money for the house.

Our children are smarter and wiser, and kinder than we usually give them credit for. Cherish them while they are with you and have fun this Christmas!

I hope the following clip will help inspire you to seek the true magic of Christmas, this year which is through the Savior, Jesus Christ. Merry Christmas!

**Reminder! If you are doing holiday shopping, don’t forget to activate your cash back from your Ebates account. This is the time of year when I get the most back (if I actually remember to activate it!)

You can install this button on your browser and it will remind you every time you go to an eligible site for cash back! I also highly recommend ZULILY for great deals and discounts on gifts for kids!