Christmas debt hangover- how to avoid it?

January 20th 2013

The Christmas bells have started chiming to usher in the festive mood. It’s the time of the year that brings excitement, cheer, ecstasy and above all hope. For many, however, the Christmas time lands them in financial hot water. While surfing on the net, I came across a survey that says that an average American spends around $750 dollars on holiday gifts and accessories. So, for a family that comprises of two adults the figure comes around $1500!!! Isn’t it scary?

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I have seen people who don’t even have a spare $100 in their accounts but borrow money in the run up to eat and have fun in Christmas. It doesn't have to be this way. Though Christmas is a party time but you have to remain careful and more importantly financially organized so that you don’t fall into the debt trap. If you go through our Christmas budgeting forum, you would find that people start planning for the Christmas holiday activities and spending in advance so that they don’t become a budget breaker.

For many, Christmas without gifts is not a Christmas!!! So, gifts are definitely a major expense for Christmas, but if you look carefully Christmas expense is not all about gifts….there is food, entertainment activities, home and Christmas tree decoration, gift wrapping and cards too. These are some of the hidden expenses that will quickly add up and you can go over budget. So take some time to forecast their costs, while you budget a spending plan on this Christmas.

While you are chalking out a spending plan, calculate the disposable income you can contribute for the Christmas costs. For instance, if you had started planning for Christmas some 6 months back then calculate the amount you will be able to contribute each week so that it covers your expected Christmas costs. Don't be disheartened if the amount per week seems small. If you save $10.00 or $20.00 per week over these 6 months, then it can provide you with quite a hefty nest egg. And if your estimated expense is exceeding the amount saved in your nest then you will have to re-figure your spending plan to a more realistic amount.

These are some of the things that I do to avoid Christmas debt hangover…if you have something more to share then feel free to share.

luv ya'll!!

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