This year we tightened our Christmas budget. Cut it in about half. And you know what? We're having fun! All the Christmas shopping is done, we have some fun gifts that we're happy to give to all those family members we love so much! We maybe got a little more creative. We really didn't do anything homemade to save money this year, although we've done that in previous years - but sometimes that can be very time consuming and stressful (and even expensive). We do start picking things up in October. A lot of times you just see something when you're out and about, so we just pick it up then - specially if it's on sale. Then a chunk of our shopping is done before the holidays even hit. This year, we even kept the holiday events schedule somewhat simplified. We kept our lists of who to buy gifts for simple.
We keep track of what we spend each year & we budget for it - but not throughout the year. Our budget is setup so that it's budgeted late in the year (our expenses are lower the last few months). And this year having high legal expenses made a real impact - so we responded by lowering the holiday budget rather than getting in over our heads.
We use our cards for everything and pay it off immediately. If we don't have the cash, we don't buy it. Like L'il Mirth says, that budget helps us discipline ourselves into not overindulging our kids (or ourselves) during the holidays. It really makes Christmas relaxed and fun.
Speaking of gifts - anyone know what DH got me? I'm not getting a single hint from that man.........