Wednesday, November 27, 2013

How to Stay Within Budget at Christmas: 3 Tips to Avoid Holiday Debt

Ways to Save Money at Christmas - Photo by earl53
Although many people think of green trees and red holly berries during the holiday season, seasonal green dollar bills may seem to sprout wings, leaving one seeing red in the bank account. In a less than favorable economy, many people who worked full-time may find their job in jeopardy, and those who work part-time may suddenly find themselves scrambling to find additional jobs if hours are cut. With student loan interest on the rise, soaring costs of healthcare and childcare, and higher prices for other essentials, many people face hard decisions regarding extra spending during the holidays. According to the Department of Commerce, in 2011 the average household debt increased to $70,000.

Set a Christmas Budget

Want to stay out of debt for Christmas? First, determine how much money you can afford to spend. Most people can predict approximately how much money they will make in a given month. Next, determine predictable expenses for one's household each month. Decide what you can afford to spend that is over and above expected costs. Avoid planning to spend all money that does not go to essentials – unexpected expenses like car repairs or replacing a broken refrigerator in December can rapidly lead to added debt if you do not have cash reserve.

Planning ahead financially can lead to much more financial satisfaction. Some people find it helpful to set aside money each month throughout the year in order to stay within budget. Those who struggle with purchasing past the limit may find it helpful to only pay for gifts with cash. When the greenbacks run out, the Christmas shopping is over. However, one might consider additional gifts that do not cost money, such as a handmade gift, providing a service such as cleaning the house, offering to watch someone's kids for an evening, or a heartfelt letter.

Popular gifts for Christmas may have skyrocketing prices in the weeks before December 25. Looking for deals, sales, and coupons can be advantageous. One may find lower prices and a better selection at other times of the year. Avoid the temptation to buy all the latest trends – many of those begin to get "old" rather quickly. A thoughtful gift during hard financial times might translate to giving gifts of necessity rather than leisure.

If purchasing tickets for an event, ask if deals are available. I have saved as much as 50% for event tickets that do not have advertised specials. One might also ask if the salesperson can offer an unadvertised discount or price match for an item in a store. You may be pleasantly surprised.

Many low cost holiday decorations and items, from Christmas trees, ornaments, and wreaths to clothing and cards, may be found at thrift and consignment shops before and after Christmas. One can often find great deals on traditional holiday foods right after Thanksgiving. If you have freezer space, you might consider purchasing the Christmas turkey when prices drop after Thanksgiving.

Making a Christmas Gift List and Checking it Twice - Photo by ronnieb
Check the Christmas List

Although Christmas is a time that many people wish to spend together with family, many find it nearly impossible to purchase gifts for everyone in the family. Extended families of 50 or more people can turn into a huge burden for those who live on a tight budget, instead turning the days before Christmas into multiple hours trying to find meaningful gifts for everyone coming, leaving the person drained of the Christmas spirit and the pocketbook drained as well. Those who struggle financially may resort to avoiding family get-togethers because they cannot afford the multiple gifts expected by others and they may lack the funds for transportation.

Many families choose to limit gift giving. Some only purchase gifts for the children or draw names among those who wish to participate in gift giving. Families might exchange very inexpensive or silly gifts to offer a laugh.

Others do away with traditional gift giving altogether. Some families encourage one another to do volunteer work and share their experiences instead. Some family members may offer to cover the cost of transportation, making the gift the ability to be together for the holidays.

Carefully consider each person on the gift list and determine one's motives for doing so. Many people purchase gifts for people they do not know or do not particularly care to be around for various reasons. Many of those gifts that might be adding to one's debt end up being re-gifted or immediately donated to places like Goodwill.

Tips for Finding Low Cost Christmas Activities © Katrena
Consider Free and Low Cost Entertainment, Food, and Activities

As the holidays approach, many people eat at restaurants; however, one can save quite a bit of money by making the meals at home, and the food selections may be healthier. Meal preparation can involve the whole family. Those who live close to others might consider progressive meals in which various homes prepare one part of the meal while everyone travels from home to home to enjoy each part together with friends and/or family for an interesting twist and change of pace.

Many local towns and counties offer a wealth of free and low cost Christmas and holiday activities. Enjoying a parade together with the family or attending church services to celebrate the season offer opportunities to be with one another and enjoy quality and quantity time.

A staycation can be quite rewarding and less stressful for everyone. Staying at home and watching a Christmas movie or playing board games together can be memories more cherished than that expensive present under the tree. Playing scavenger hunts, reading library books, having a home holiday "spa," and playing hide-and-go-seek in the dark may keep the kids unplugged from electronic devices and engaged in enjoying family time together. Staying home does not necessarily mean being alone.

Most people would not have to look far to find others who are staying at home or may be alone. Homeless college students are often forced out of the dorms during winter break. Many people who live in assisted living facilities or long-term care facilities would love to share holidays with a friend. Inviting someone to enjoy the holidays with one's own family can prove to be a blessing for everyone.

How to Avoid Going Broke for the Holiday - Photo by Ladyheart
Additional Articles:
Find more of Katrena's articles, scavenger hunts, printables, and tips at the Wildflower Bouquets site map.

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