As a volunteer budget coach, I encounter many people who have lived beyond their means and fallen into desperate straits. One of my goals in life is to teach people how to avoid the debt trap – or to climb out if they’ve already fallen into it. I don’t want to get too preachy, but this subject will come up over and over in my blog.
Now that Halloween is over, shoppers will begin hitting the stores with visions of Christmas bargains dancing in their heads.
Many of us will spend more money than we have, figuring that we must use plastic to finance our family’s happy holiday. We’ll worry about the bills in January, when we’re not so busy trying to make things sparkly and special, we tell ourselves.
Then January (or perhaps even December) rolls around, and we open the first bill. We had no idea we spent that much! And for what? A toy that gets shoved under the bed after two weeks (or less), a sweater that the recipient hates, decorations that will spend most of the year in the closet …
The Christmas season: The retailers love it. The credit card companies love it. And we love it … until the spending hangover.
No one enjoys the aftermath of a spending binge.
The problem, in my view, is twofold: too-high expectations and too little planning.
Most of us have unrealistic expectations. We want our holiday celebrations to be perfect … or at least as close to those in our memories as possible. But those memories don’t have to include extravagant spending.
The best gifts I have received were homemade. I will never forget the tiny red wooden firetruck my brother made for me in the 1970s, when the TV show Emergency! was popular. Granted, my brother and I fought like cats and dogs most of the time, but that Christmas he gave me a priceless gift – the gift of his time, his effort and his heart – the only gift he could give on a kid’s salary of $0 (we had chores but not allowances). I don’t have the firetruck anymore, but I still cherish the memory of my brother’s gift.
Three or four Christmases ago, I (and my little sewing machine) made most of the gifts I gave my family (my in-laws received store-bought gifts); my friends and co-workers got homemade candy or cookies. Money was tight that year, and I chose not to worry that I wasn’t giving fancy or expensive gifts and to rely on my family to understand and love me anyway.
Lack of Planning
Giving homemade gifts required me to plan ahead (although I was still sewing at 11 p.m. on Christmas Eve). But avoiding overspending requires planning, too.
You may think it’s too late this year to shop within your means for Christmas. After all, if you haven’t been funding the holiday budget all year, there is little you can do now that it’s November.
If you haven’t budgeted for it (decided on the amount you won’t exceed and saving for it all year), the alternative is to adjust your expectations – and those of your family.
Yes, this is difficult. But it’s so worth it. The payoff is in less stress. Stress over having to make sure everything on everyone’s list is bought (and presented beautifully), having to have the perfectly decorated house, and thinking you have to buy each and every acquaintance and co-worker a gift.
And stress over having credit card bills that have no end. That, in itself, is incentive enough for me.
Stay tuned for ways to give that don’t require money (feel free to submit your own tips). Meanwhile, visit my favorite Web site about the art of living below your means: Debt-Proof Living (formerly Cheapskate Monthly).
Check out Mary Hunt’s book Debt-Proof the Holidays: How to Have an All-Cash Christmas.