Step 2: List Expenses. Make a list of each person you need to buy a gift for. This includes family, friends, teachers, and co-workers. Don't forget to make a list of other holiday expenses like: greeting cards, gift wrap, decorations, baking supplies for cookie trays etc.
Step 3: Set Limits. Evaluate what you spent last year or estimate what you spent last year and determine where you need to cut back and where you need a little more. Maybe you went way overboard with the cookie trays but needed a little more money for gifts. Make adjustments where necessary and then place an amount on everything. For example, $5 for teacher gifts, $10 per co-worker, $20 per extended family member, $50 for decorations. Maybe this year you can cut back on the number of cards you send out and send e-cards instead. Many people throw away the cards after the season anyway.