Surviving the Holidays…Financially Speaking!

Black Friday…the biggest shopping day of the year. Thanksgiving officially kicks off the holiday season that will be filled with parties, gathering of friends and family and the sharing of gifts. It’s also a time to remain vigilant over your personal finances so that you don’t begin the new year with new debt. A recent survey suggests that nearly 30% of shoppers are planning on using credit cards to fund holiday purchases. It’s way too easy to get caught up in the shopping mania of this season and find yourself in a freshly dug hole in January. Here are my tips for surviving the holidays…financially speaking:
  1. Decide how much you’ll spend. Take a moment to decide just how much you’re willing to spend, overall, on gifts during this holiday season. I strongly suggest that you focus on cash that you already have in savings, money market or checking accounts. Avoid thinking in terms of credit card spending that must be paid off from future paychecks. Your goal should be to begin the new year with no new debt as a result of holiday spending.
  2. Make a list. Now that you have your budget, make a list of all the people you’d like to give gifts to and then, beside each person’s name, put a dollar limit on the maximum amount you plan to spend taking care to make certain your individual totals don’t exceed your overall budget. It’s ok to use credit cards for your purchases as long as you have the cash to pay off the full balance when it arrives the following month.
  3. Focus on the children. With the current state of the economy, many families are being very conservative with their finances. If your resources this year are more limited, consider establishing a ‘moratorium’ on gifting between spouses and focus on gifts for your children for they are the people who are most excited and have the greatest expectations during this holiday.
  4. Give something back. The economic turmoil of the past couple of years has spawned financial hardship on more families than any time in our lifetime. Use this holiday season to teach your children the importance of giving to others who are in need. There are many ways to accomplish this. You can donate clothing, food, money or you can spend some time working in one of the many shelters located in your home town.
Don’t forget that there are lots of gifts that show you care without spending a fortune. Some of my favorite gifts are a spicy cheese ball one friend gives us each Christmas and home baked sugar cookies from another. Or it can be as simple as a personal note expressing what one’s friendship has meant to you.