Birthday party budget

What It Means

A birthday party budgetBudgetA plan for a set period, usually a month, that lists the money you expect to receive and how you'll spend or save it. See more is the amount you decide to spend on a birthday celebration, set before you book a venue or order a cake. It works best split into two kinds of cost: fixed costsFixed expensesCosts that stay about the same every month, such as rent, a car payment or an insurance premium, usually due on a set date. See more that stay the same however many people come, such as the venue, cake and decorations, and per-guest costs such as food and favors. Seen that way, the budget tells you how long the guest list can be.

How People Say It

• "Let's keep the whole thing under $400."
• "Every extra kid is another $12 in pizza and favors."
• "We can do the bounce house or the venue, not both."

The Breakdown

Worked example. A family sets $400 for a birthday two months away (example numbers):

The fixed costs come to $180, which leaves $220 for guests. At $12 a head that covers 18 guests, so a list of 15 fits with $40 to spare. Setting aside $180 a month for two months pays for it before the day.

What the result means. If the plan runs over, the per-guest line is usually the quickest to change: a shorter list or a simpler favor. If the fixed costs alone eat most of the total, a different venue does more than trimming names.

The CFPB's planning steps, applied to a party

1. Decide what you can afford before booking anything.
2. List what you'll spend on, with an amount for each line.
3. Keep track as you pay, and move money to another line when one comes in under.
4. When something tempting turns up that isn't on the plan, write down the item, where you saw it and the price, check the plan, and go back for it only if there's room.

Good to Know

The Consumer Financial Protection Bureau suggests paying with cash for seasonal spending, since it helps you avoid splurges along with the fees or interestInterest rateThe yearly percentage a lender charges for borrowing money, not counting fees; the APR adds certain fees to show a fuller cost. See more that can come with credit cards, layawayLayawayA store payment plan that holds an item for you while you pay for it in installments; you take it home only after it's paid in full. See more or store financing. Buhata's suggestion: if a venue asks for a deposit, put that date in the plan too, since that money goes out before the party.

Related Terms and Categories

• Kids birthday party

  A birthday celebration planned for a child and their friends, usually with food, cake, an activity and small favors for the guests.

• Holiday budget

  A spending plan for the holiday season that sets how much you'll spend on gifts, food, travel and decorations before the shopping starts.

• Gift budget

  A spending plan that sets how much you'll spend on gifts, person by person or occasion by occasion, for a season or a whole year.

• Sinking fund

  Money set aside in small, regular amounts for a known future cost, so the bill doesn't land on a single paycheck.

• Impulse spending

  Buying something on the spur of the moment, without planning for it or checking it against your budget.

Holidays and celebrations