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January vs. December

January is the antithesis of December.

Think about it. December is all about the spending. And January is all about opening that credit card bill. I’m mostly speaking to those of you that maybe weren’t following the YNAB way in 2015, or let the holiday spirit get the best of you.

But either way, it is January and we are staring down a new year. Taxes are coming due here in a few months. And you are sitting with a credit card bill from all the holiday fun. (Which may or may not seem so fun on the other side of the fence.) That’s the bad news.

The good news is, all is not lost. Sometimes we need a wake-up call in order to change our behavior. And if this is yours, that could be a good thing. You got a credit card bill in the mail. It was stressful. And you don’t like that feeling. OK—let’s do something about it.

This is the month where you start saving for Christmas of 2016. Right now, in January. You pick a target. You set up a goal in YNAB. You say I want to spend, I don’t care if it’s $6,000, which would be $500 a month, or if it’s $2400, which would be $200 a month, or if it’s $120, which would be $10 a month. Whatever the amount is you pick, you say this is what I’m going to spend on Christmas. You make a decision.

When you are coming up with your personal magic number, be sure you make that category all-inclusive. Do you buy new Christmas lights? Do you have a big family dinner, where you buy three turkeys and smoke them? And why haven’t you invited me? Do you send out Christmas cards, and how much do those cost? Do people come to your house and eat you out of house and home? Do you end up traveling a lot? What kind of expenses crop up purely from the holidays? Include all of them in your Christmas category.

Not to mention the gifts! Oh, the gifts! Who will you give gifts to? Now that it’s fresh in your mind, who gave you what? It’s a good time to rate your gifts and plan your gift giving accordingly. I’m just kidding! But seriously, who would you give a gift to? Put them on a list.

Start to think, what’s the amount that you’re comfortable with spending for Christmas of 2016? Divide that number by 12, or if you’re using YNAB, just plug it in as a goal and YNAB will do the math for you. Just make it a monthly bill. Every single month, you’ll just pay a little bit for Christmas.

I promise you, I’ve done this for years, and thousands and thousands and thousands and thousands of YNABers all over the world have done the same thing. It feels so good when you have the cash just sitting there waiting to be spent. It makes Christmas much more magical. Because next December there will be no guilt and next January, you won’t be feeling the feelings that you’re feeling right now.

Really all you are doing is evening out your cash flow. It removes the stress of a massive peak of expenses. The stress is just gone. And suddenly, instead of this crazy rollercoaster ride that’s inducing so much stress, suddenly you just have a normal month.

As normal as a month can be anyway. There really is never a “normal” month, but we sure like to try and normalize it as much as possible. And this is one way to do it.

What will you spend on the holidays next year? I guess I should say this year, although it seems so far away. What will you spend? Put that into YNAB. Make it a goal and let YNAB keep you on track and see how happy the holidays can become.


Adapted from Podcast #206: January vs. December, the one in which Jesse talks about the difference between doing the spending and paying for the spending.

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January vs. December