To budget for holiday parties without overspending, you'll need to keep track of how many guests you'll have, make sure 50% of your budget goes toward food, never buy decorations full price, and pay for items with cash.

Celebrating the holidays with close friends and family is always a blessing, so getting to make those rare occasions extra special through a charcuterie spread at Thanksgiving, twinkling Christmas lights, or sparklers on New Years Eve can make all the difference to an extra special celebration. While getting to host a party during the holidays can be a blast, it can also become expensive if you're not keeping track of your purchases and spending.

Leaders Credit Union is happy to help you prepare for the holiday season financially by ensuring you have the tools you need to stay in budget.

How Should You Budget for a Holiday Party?

Creating a budget is key when preparing for the holidays. Whether you're thinking about what appetizers you're serving or how you want to deck out your front lawn with Christmas lights or blow-up snowmen, the last thing you want to be worrying about is money...that's not even considering spending for Christmas presents!

That's why having a budget ready to go before you begin spending is essential, so you can enjoy party planning and protecting your finances at the same time.

Average Costs of Hosting a Party

5-10 Guests: $75-200

15-25 Guests: $200-500

30+ Guests: $500-1,200

The real cost of your party will be determined by your guest count, since you'll need to have a certain amount of food, place settings, or supplies for crafts or holiday traditions. 

Holiday Party Budget Breakdown

Food & Drinks - 50%

Whether you're making a homemade casserole or getting a catered meal, food is likely going to put the biggest dent in your budget. This cost can also stack up fast if you plan to serve alcohol. 

Entertainment - 20%

Gingerbread house contests, gift exchanges, and other fun activities and traditions make the holidays fun. Be sure to consider what you'll need to include for supplies for crafts or activities in your budget.

Decorations - 15%

From place settings to decorative pillows, decorations for your party add up quickly, especially if you have multiple guests. 

Invitations - 10%

This category may not apply to you depending on your situation, but this cost is important to consider if you plan to send out physical invitations because you'll need to consider postage, invites, and the envelopes. Even digital invitations can have costs if you're paying for a service that helps you keep track of RSVPs.

Contingency - 5% 

Account for any sudden changes to your party, such as last-minute invites to more guests or a location change. 

How Do You Cut Costs for Party Planning?

Whether you've planning parties for decades or if it's your first time hosting during the holidays, there are different ways you can save money on your essential party items.

1. Make a Meal at Home

You can save a lot of money by not catering and making your meal at home instead. Choosing to cook yourself instead of buying takeout can help you save more of your food budget. This strategy can help you allocate more money to other items you need for your party, or better yet...save for your next one!

2. Host a Potluck

You don't have to be a great cook to host a great party. Have your guests join in on a holiday potluck, a great way to save on money and discover what everyone enjoys for the holidays. It's an also a fun way to see what everyone's favorite dishes are. 

For example, you could be hosting Thanksgiving dinner. You could fix the turkey and an appetizer, then the rest of your guest could bring their favorite dishes to share. This not only makes a fun tradition and a strategic way to save money.

3. Never Buy Decorations Full Price

Before the holidays, many retail stores have sales or discounts for holiday items, such as paper plates, garland, pillows, and more festive products. Some stores that offer deals include:

• Hobby Lobby
• Michael's
• TJMaxx
• Marshall's
• Home Goods

4. Host a White Elephant or Secret Santa Gift Exchange 

If you are hosting a party closer to Christmas but you want to save money on gifts, host a gift exchange. Games you and your guests could play could be White Elephant, Secret Santa, or Dirty Santa. While the rules for these games can vary, the general idea is that each guest purchases one gift within a certain price limit that everyone agrees on, so no one is buying a far more expensive gift than another. Not only does this keep everyone in budget for the gift, but it helps your overall budget by not needing to purchase gifts for each guest.

How Can I Keep from Overspending While Holiday Shopping?

Set Up Text Notifications

Before you go out shopping for your party, set up notifications on your phone to let you know when you're getting close to your limit. This will not only be a useful reminder of how much you've budgeted for, but also to help you be aware of when you're getting close to overspending. 

Shop with Cash

Another preventative way to keep yourself from overspending is to pay with cash. Visually seeing where your dollars are going will help you to know exactly what you've already spent and literal dollars you have left to spend. 

FAQs about How to Budget for Your Holiday Party

Q: How do I budget for hosting a holiday party at my house?

A:  Your budget will be most impacted by the number of guests you have coming to your party, so be sure you know the exact amount of people coming. Typically, a party with 15-25 people can cost around $200-500. Your biggest expenses will be food, drinks, entertainment, and decorations.

Q: How much should I budget for food at my party?

A: 50% of your party's budget should go towards food and drinks.

Q: How can I keep from overspending while shopping for my party?

A: Set up notifications on your phone to go off when you're nearing your budget limit, or pay only with cash.

Party Prep with Leaders Credit Union

Planning for a party during the holidays is super fun and exciting. Whether you're hosting Thanksgiving or preparing for a family get-together for Christmas, it's important that you feel financially secure while holiday spending. Don't hesitate to reach out to a Financial Champion at Leaders to ask questions you have about your finances.

Looking for financial tips this holiday season? Read our blog, "Christmas Savings: The Best Way to Manage Money for the Holidays".

Deepen your understanding of how to manage your budget with our free smart budgeting toolkit.

Leaders is federally insured by the NCUA.