How the Half-Payment Method Helped Us Pay for Christmas
Each year at Christmas time, families all around the country become incredibly stressed. It’s supposed to be the happiest time of the year! The holidays can cause incredible financial stress for those who don’t have a Christmas savings plan. That’s why I want to introduce you to the half-payment method and how we break it down to help us have a stress-free Christmas.
What is the half-payment method?
The half payment method is a budgeting technique for those of us who are paid biweekly. Essentially, we develop our monthly budget and then divide each payment in half. Then, we set aside half of each payment out of each of our checks. That way, when the bill arrives, we have all the money we need.
This works very well for our consistent expenses, like internet, or cell phones. It even works for non-consistent bills, like food. That way, we don’t overspend on those flexible expenses! It also works for people paid weekly, if you just split into four payments
My husband works an hourly job, so his income is sometimes inconsistent. This method ensures that we have the money for our bills when the due date comes.
For our expenses that are more inconsistent (or inconsistent paycheck amounts), we estimate how much we need in a month and then try to stay within that. Any leftover can either roll into the next month or go into savings. I like rolling it over because then we have some cushion for when unexpected things pop up!
How does this help me with Christmas?!
A Christmas savings plan is easy! Last Christmas we took a look at all the extra expenses we had during the holiday season and divided it by 11 months (January to November). This included what we budgeted for gifts, extra driving to family events, and extra food. It also included wrapping paper, cards, stamps, and anything else extra. Then, we added it to our monthly budget. That way, we set aside a small amount of money each paycheck into our savings, and then we are stress-free because we know we have the money to spend.
Then, you have a Christmas savings plan!
Honestly, we are also huge Black Friday shoppers, too! We actually have a “gifts” fund that we contribute to that also pays for our Black Friday deals, as well as gifts and cards for other events. It pays for birthdays, weddings, and showers, even gas and hotels. It has worked wonders for our budget. We no longer stress when a wedding invite comes in the mail because we have piled up some money to pay for those things and feel good about being able to give generous gifts.
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