Tis the Season to be Frugal -11/25/07

Tis the Season to be Frugal -11/25/07

Stewart H. Welch III, CFP, AEP
Founder, The Welch Group, LLC



‘Tis the Season to be Frugal



Thanksgiving marks the beginning of the holiday spending season.  To make sure you don’t overspend this year and end up starting out next year with additional debt, follow this simple 4-step process:


Step 1.  Determine the total amount of money you can afford to spend on all gifts.  Here’s the BIG RULE: Your budget cannot exceed cash funds you already have.  Do not count on future paychecks to cover your holiday gift giving.  I know that for many people this means that your budget will be extremely small but stick to the rule. 


Step 2.  Make a list of everyone to whom you plan to give a gift.


Step 3.  Assign dollar amounts as “targets” for how much you will spend on each person on your list.  Be sure that your individual totals do not exceed your overall budget. 


Step 4.  Keep a running total of all of your spending whether you use your checkbook, cash or credit card.  Remember that your goal is no new debt.


If you find yourself ‘long on names and short on cash’, don’t despair.  Here’s a list of some of the best ideas for presents that come from the heart but don’t cost much:


  • Give ‘baked’ goods.  Everybody loves food and nothing says you care more personally that something you baked.  Every Christmas, I look forward to the spicy cheese ball from one long-time friend and home baked sugar cookies from another.
  • Make a donation to a charity.  Many charities offer multiple gift cards that acknowledge to the recipients that you have made a donation in their names. 
  • Pass along a cherished possession. There’s no rule that gifts have to be new. If you know someone has always admired something you own—a piece of jewelry you inherited or a framed print—why not pass along that item to that person. Wrap the item in fancy paper with a bow and include a note saying that you hope the item brings them the same pleasure that it brought you.
  • Give a ‘Time Certificate’.  Create by hand or computer a mock gift certificate. It can include babysitting, yard work…use your imagination.  This offer can be modest or extravagant—but the recipient will certainly know that you’re giving of yourself with this gift!
  • Create a Holiday CD.  Record some of your favorite holiday songs and make a CD using a CD “burner”. They’ll love the music and think of you every time it’s played.
  • Start a Photo Album.  In most families, there’s one person who loves taking and keeping photographs. If you’re that person, go through your albums, especially your old ones, and create some smaller albums for your relatives. Or reproduce one old picture, perhaps with relatives who have passed away, and frame it as a gift.
  • Write a note.  People often do not take the time to tell others how much they mean to them.  Write a note to the special people in your life.  You will likely find that it is the one gift they will cherish forever.


Remember, it not how much money you spend but sharing your heart that is at the true heart of giving.  Have a blessed holiday season!