As we are all putting our houses back in order from the 2014 Holiday, this is a good time to begin thinking about 2015. There is one thing for certain in life — birthdays, Christmas and other celebrations comes at the same time every year. As we were doing our goal setting for 2015, we set aside a budget category for gifts and vacations. We started with birthdays. We wrote down everyone we give a gift to on their birthday and wrote down the amounts. We then looked at Christmas. We set the amount we were going to spend on each person on our list and then added it up, this became our gift budget.
Next we looked at vacation. We know how many vacations we plan on taking in 2015 and set out budget amount for each of these vacations. After this was completed. We took the total amount and divided it by 12. This is the amount we need to set aside each month. By doing it this way, we always have money available for birthdays or other celebrations. This makes the holidays and vacations much more stress free.
The reason we combine these categories is two-fold. First, we try to not make our budget too complicated. We feel by having more general categories it gives us more flexibility. The reason it make sense to combine these two categories is this is the first area we would cut if we needed to tighten our budget in any way.