The holidays have a way of sneaking up. One minute you're packing away summer clothes, and the next you're writing a gift list, planning a Christmas meal, and watching the heating bill climb. When things are already tight, the season can feel like it asks for more than you have.
The good news is that you don't need a big income or a complicated plan to get ahead. If you've been wondering how to save money for the holidays without stretching yourself thin, a short savings challenge can help. Setting aside a little each week adds up faster than you might think.
This 5-week challenge gives you a simple plan with realistic weekly targets and practical tips to reach them. By the end, you'll have a comfortable amount of cash for gifts and celebrations, plus a small buffer for surprise expenses that always seem to show up this time of year.
Key Takeaways
Setting aside a small, steady amount for five weeks can build a holiday cushion of $150 to $400 before Christmas.
Split your total 70/30, with most going to celebrations and the rest kept as a buffer for surprise costs.
Each week has one focus: a low-spend week, cutting unused charges, trimming grocery bills, bringing in extra cash, and planning your spending.
Keep your cushion apart from day-to-day funds, either in a separate bank account or a cash envelope.
If a big expense hits, use your buffer first and look into payment plans before borrowing.
Why a Holiday Cushion Makes the Season Easier
A holiday cushion is a small amount of money you set aside ahead of time. It helps you get through the season without falling behind on bills, facing overdraft fees, or struggling to cover expenses in the new year.
The easiest way to think about it is in two parts:
Gift and celebration fund: This covers the costs you can plan for, such as gifts, holiday meals, travel, and seasonal activities.
Surprise buffer: This covers the costs that show up at the worst possible time, like a flat tire, a higher heating bill, a broken appliance, or other last-minute expenses.
A simple split is 70% for gifts and celebrations and 30% for your buffer. So if you put away $400 over the next five weeks, you’d have $280 to spend and $120 set aside, just in case.
Of course, sometimes a bigger expense comes up that your buffer can’t fully cover. In those moments, you can cover the difference with a holiday loan without putting your plans on hold. Just be sure to borrow only what you can comfortably repay.
How the 5-Week Challenge Works
The idea is simple. Pick a savings level that fits your budget, then set aside the same amount every week for five weeks. A set amount makes the habit easier to build and easier to plan around your paycheque.
Level | Weekly Savings | 5-Week Total |
Starter | $30 | $150 |
Steady | $50 | $250 |
Stretch | $80 | $400 |
Every level counts. Even the Starter level gives you $150, which can cover a holiday meal and a few small gifts, with some left over for your buffer.
A few tips to get started:
Start five weeks before your first big holiday expense. This could be a gift exchange, a festive dinner, or a trip to see family.
Line up your weekly savings with payday. Setting money aside as soon as your paycheque or benefit deposit arrives means it’s saved before it has a chance to get spent.
Paid every two weeks? Plan by payday instead. Over five weeks, you’ll usually get two or three paydays. Divide your level’s total by the number of paydays you’ll have. For example, at the Starter level, that’s $75 per payday if you have two, or $50 if you have three.
Helpful note: If your income changes from week to week, like with shift work, gig work, or self-employment, set aside extra in your higher-earning weeks to make up for the slower ones. What matters is reaching your five-week total, not hitting the exact amount every week.
Wondering where the extra cash will come from? The next section breaks down easy ways to save money each week, so you’ll have a plan for reaching your target.
Money Saving Strategies to Hit Your Weekly Target
Each week of the challenge has its own focus to help you free up cash. Together, these strategies can also show you how to save more money well beyond the holidays. You don’t need to try everything on the list. Pick the ideas that fit your lifestyle and budget, and let the rest go.
Before You Start: Set Your Holiday Number
First, figure out what you’re working toward. Knowing your number makes the goal feel real and helps you choose the right level for the challenge.
Start with your gift list. Write down everyone you plan to buy for and set a spending limit for each gift. Then add the extras that are easy to forget, such as:
Seasonal groceries and baking supplies
Transit or gas to visit friends and family
Winter clothing, like boots, coats, or mittens for the kids
Hosting costs, wrapping paper, cards, and postage
Once you have your total, compare it to the gift and celebration portion of your savings level, and remember to leave room for your surprise buffer. For example, if your list comes to $175, The Steady level ($250) covers it and leaves about $75 for unexpected costs.
If your total is higher than you expected, you can choose a higher level if your budget allows, or trim the list now rather than in December, when there’s more pressure to spend.
Week 1: Try a Low-Spend Week
This week’s target: Starter $30 | Steady $50 | Stretch $80
A low-spend week is one of the simplest ways to save money; it shows how far you can stretch your budget. For seven days, stick to the essentials, such as rent, bills, groceries, transit, and medication. Hold off on everything else.
That means skipping takeout, coffee runs, impulse buys, and online shopping for the week. If something non-essential catches your eye, write it down and come back to it next week. Often, the urge to buy it passes.
Try to make the most of what you already have. Cook from your pantry and freezer, and look for free ways to have fun, like a movie night at home, a walk around the neighbourhood, or a trip to the library with the kids.
Whatever you would have spent, set it aside. Skipping one takeout meal and a few coffee runs could cover your Week 1 goal at the Starter level.
Week 2: Cut Costs You Don’t Need
This week’s target: Starter $30 | Steady $50 | Stretch $80
Small charges are easy to miss, but they add up fast. This week, take a few minutes to look through your last two bank statements and flag anything you don’t need. Some of the best money saving tips involve changes you only have to make once.
Here’s where to look:
Subscriptions: Cancel or pause any subscription you haven’t used in the past month.
Bank fees: Ask your bank about a no-fee or lower-fee account.
Phone and internet: Call your provider and ask about a more affordable plan or loyalty discount.
App purchases: Check for small recurring charges, especially on shared family devices.
Think about it: cancelling two $15 streaming services and dropping a $10 monthly bank fee frees up $40 a month. Set the $40 aside, and you’ve covered your Week 2 goal at the Starter level. Even better, the savings keep coming every month after that.
Week 3: Save on Groceries and Meals
This week’s target: Starter $30 | Steady $50 | Stretch $80
Groceries are one of the biggest costs in most budgets, which makes them a great place to cut back.
One of the most useful money saving tips is to plan your meals around what’s on sale. Check the weekly flyers or a flyer app before you shop, then build your list from there. Need a starting point? See what happened when we used AI to plan a week of meals for $50.
Cooking in batches helps too. A big pot of soup or chili can cover a few dinners, with extra for the freezer (perfect for this time of year). Store brands often cost less than name brands, and frozen produce lasts longer, so less food goes to waste.
If you collect PC Optimum or Scene+ points, save them for your festive shopping. Your points can also go beyond buying food. PC Optimum points can be used toward kids’ clothes at Joe Fresh, and Scene+ points can help cover a holiday gift from Home Hardware.
Swapping two takeout dinners for home-cooked meals could save a family $40 to $60 this week, which is enough to reach your Week 3 goal at the Starter or Steady level.
Week 4: Bring In a Little Extra Cash
This week’s target: Starter $30 | Steady $50 | Stretch $80
By now, you’ve cut back on spending. This week, the focus shifts to bringing in a little extra cash, and some of it may already be sitting in your home.
Start by looking for things you no longer use. Clothes your kids have outgrown, toys, small appliances, and furniture can often sell quickly on Facebook Marketplace or Kijiji, especially before the holidays, when people are shopping for deals. When meeting a buyer, choose a busy public spot, like a coffee shop or a police station’s safe exchange zone.
A few other quick ideas:
Return unused purchases: Check for items that are still within the return window.
Cash in bottles and cans: Most provinces offer a refund on at least some beverage containers. See what’s refundable where you live.
Offer a quick service: Babysitting, pet sitting, or yard cleanup for neighbours can bring in cash fast.
Pick up an extra shift: If your job allows it, even one extra shift could cover this week’s goal.
For example, selling a winter coat you no longer wear for $25 and a rarely used kitchen appliance for $25 could cover your Week 4 goal at the Steady level.
Week 5: Finalize Your Savings and Plan Your Spending
This week’s target: Starter $30 | Steady $50 | Stretch $80
You’re in the home stretch! After this week, your holiday cushion is complete.
Set aside your surprise buffer first, so an unexpected December cost is already covered. Then use your holiday number to guide your shopping, and stick to the limits you set for each gift.
Gifts don’t have to be expensive to be meaningful. Try a Secret Santa so everyone buys one gift instead of many, or give something homemade, like baked goods. Your local library or community centre may also offer free seasonal events, which are a great way to celebrate without spending.
If you receive the Canada Child Benefit, your December payment arrives earlier than usual, on December 11. Check the CCB payment dates and plan your shopping around it.
Where to Keep Your Holiday Savings
Once you get started, keep your cushion separate from your everyday spending so you don’t use it by accident.
A separate savings account is one of the easiest options. Many banks offer no-fee savings accounts, and some let you set up automatic transfers on payday, so you save each week without having to think about it. Some banks also offer round-up features that put aside your spare change with every purchase, giving your cushion a little extra boost.
If you prefer cash, an envelope kept somewhere safe at home works too. Watching it fill up each week can be a great motivator.
What If an Unexpected Expense Comes Up?
Even with a solid plan, some costs can catch you off guard, like a car repair or a furnace that stops working in the middle of winter.
Start with your surprise buffer, since that’s exactly what it’s there for. If the cost is more than your buffer can handle, look at what can shift. You could scale back a few holiday plans, move a gift or two to January, or ask the service provider if they offer a payment plan. Many do, especially for larger repairs.
If you still need help covering the cost, a short-term loan could help bridge the gap. Before you apply, take a moment to learn what responsible borrowing looks like, then use our loan calculator to see exactly how much you’ll repay and when.
Frequently Asked Questions
How can I save more money on a low income?
Start small and stay consistent. Even $5 or $10 a week adds up. Focus on changes that keep paying off, like cancelling unused subscriptions, planning meals around sales, and asking your phone or internet provider for a lower rate.
When should I begin the 5-week savings challenge?
Start about five weeks before your first big holiday expense. For Christmas, that’s no later than November 20. Starting late? You can still join in by setting aside a little more each week or aiming for a lower total.
What if I miss a week of the challenge?
Don’t stress! It happens. Just pick up where you left off the following week, or spread the missed amount across the weeks that are left. What matters is getting to your total, not being perfect every week.
How much should I budget for holiday gifts?
With the 70/30 split, you’ll have up to $105 to spend at the Starter level, $175 at Steady, and $280 at Stretch. For example, $175 could cover $50 each for two kids and $25 each for three adults.
What can I do with any money left over from the holidays?
Keep whatever’s left over as the start of an emergency fund. You can also continue the same weekly habit to prepare for upcoming expenses, including higher winter heating bills or January's rent.
