Would You Be Willing To Cancel Christmas This Year?
George Boelcke CCP
November 28, 2007
Yes, I call it Christmas, as I’m a Christian. It is not the holidays – I have those next summer and they’re different, sorry. And I know canceling Christmas is a little extreme – and we’re not talking about the celebration, giving up your faith, or the chance to spend time with your family. We’re just talking about the excess spending part of the holidays, all of which will add up to about $500 billion. And as we look back on our Thanksgiving weekend, for millions of Americans the debt pain is already well on the way.
According to a just released Gallup survey, Americans will spend around $909 on gifts this Christmas. But as a country, we’re already spending more than our entire household incomes each year and, according to the Commerce department, our savings rate is at minus one percent and dropping. That means most of our holiday spending will need to go on credit cards. Ouch!
For anyone who intends to pay off that balance in January, it’s not a big deal. No – forget that – it’s worded wrong: we all INTEND to do that, but surveys keep showing we’re overly optimistic about that. In fact, when asked, the average person claimed it took two months to pay off their holiday shopping. Yet, the actual time was over six months! Let’s face it – July is NOT when you want to deal with last years’ holidays!
And it’s not just the gifts we buy, but also the added spending for trips, the tree, decorations, cards, postage, concerts, clothes, hairdressers, all that food, and the total amount quickly doubles what we spend.
So here are nine tips to financially surviving this Christmas holiday season:
Get realistic – make some kind of simple budget, stay within it, and practice the four most powerful words nobody ever wants to say: “I can’t afford it.”
Don’t leave home with it – yes, you can make it through the shopping season without your credit cards – honestly! Department store cards are over 20% and typical major credit cards average 15%, which isn’t worth the risk that you can’t pay them off in January. Besides, a penny over your limit and you’ll trigger an over-limit fee upwards of $39.
It’s the thought that counts – not all your presents need to be measured by the amount of money you spent. If you think back, some of our most memorable presents were either home made or well thought out and appropriate and weren’t about the total money spent. Have a look at www.buynothingchristmas.org a web site designed to encourage the reduction of commercialization of Christmas and lots of alternate ways of giving.
Cash is king – when you’re at the cash register there is a very different feeling to laying a bunch of $20 bills on the counter, instead of using a credit card, which never has that same reality attached to it. This way, when you’re out of money – stop shopping. With a number of credit cards there’s no reason to stop and merchants know that the average purchase is much higher when we pay with a credit card!
Know what’s important – resolve to make this holiday season less about money and more about important things. Focus on the difference between the meaningful and the meaningless. That might be time with your family, a donation to your favorite charity, your faith, or many other things. Most of these are not measurably by money, tend to cost less, benefit others more, and come with huge personal rewards and satisfaction.
Speed kills – it’s not just a traffic rule, but also includes your impulse purchases. It will always cost you more money if you don’t take the time to shop around or consider some alternatives. But this also means you can’t start your shopping on December 23rd. It’s a guaranteed way to have a small selection, no sales, big price tags and a sure-fire debt hangover.
Just say no – set a point where you’re done. No more “just one more thing” or “I should also get that.” It gets harder when you have kids, because they’ll see hundreds more commercials for stuff they “have to have” between now and December 25th.
Make a list and check it twice – it works for Santa, who is the biggest shopper this time of the year, so discipline yourself as well. Don’t leave the house without a list and a good idea of what you’re looking for, as well as a price range. Cruising the stores is frustrating and many people tend to just buy something – anything – just to get on with it, and that’s never a budget smart way to make purchase decisions.
Wrap it up – keep the receipts for all your spending during the holidays and make a note of it for next year to get smarter and better prepared for 2008. You’ll also need to get a game plan for paying back your holiday spending as early as possible next year. What will that take? No dinners out, skip the movies or some overtime at work? After all, if you just pay the minimum payments on a $2,000 credit card, it’ll take almost 15 years to pay it off and the last thing you want is someone wishing you a Merry Christmas next July when you’re still paying off your debts!
So what’s the best Christmas present you can give yourself this year? Cut up all but one of your credit cards, stop rate surfing, which is just moving them around, and start paying the balance off in full. Resolve to work towards your debt freedom in 2008, instead of another year of treading water. Resolve to do more of what works and less of what doesn’t.
It’s worth it – you’re worth it – and it’s the greatest gift you can give yourself and your family.
According to a just released Gallup survey, Americans will spend around $909 on gifts this Christmas. But as a country, we’re already spending more than our entire household incomes each year and, according to the Commerce department, our savings rate is at minus one percent and dropping. That means most of our holiday spending will need to go on credit cards. Ouch!
For anyone who intends to pay off that balance in January, it’s not a big deal. No – forget that – it’s worded wrong: we all INTEND to do that, but surveys keep showing we’re overly optimistic about that. In fact, when asked, the average person claimed it took two months to pay off their holiday shopping. Yet, the actual time was over six months! Let’s face it – July is NOT when you want to deal with last years’ holidays!
And it’s not just the gifts we buy, but also the added spending for trips, the tree, decorations, cards, postage, concerts, clothes, hairdressers, all that food, and the total amount quickly doubles what we spend.
So here are nine tips to financially surviving this Christmas holiday season:
Get realistic – make some kind of simple budget, stay within it, and practice the four most powerful words nobody ever wants to say: “I can’t afford it.”
Don’t leave home with it – yes, you can make it through the shopping season without your credit cards – honestly! Department store cards are over 20% and typical major credit cards average 15%, which isn’t worth the risk that you can’t pay them off in January. Besides, a penny over your limit and you’ll trigger an over-limit fee upwards of $39.
It’s the thought that counts – not all your presents need to be measured by the amount of money you spent. If you think back, some of our most memorable presents were either home made or well thought out and appropriate and weren’t about the total money spent. Have a look at www.buynothingchristmas.org a web site designed to encourage the reduction of commercialization of Christmas and lots of alternate ways of giving.
Cash is king – when you’re at the cash register there is a very different feeling to laying a bunch of $20 bills on the counter, instead of using a credit card, which never has that same reality attached to it. This way, when you’re out of money – stop shopping. With a number of credit cards there’s no reason to stop and merchants know that the average purchase is much higher when we pay with a credit card!
Know what’s important – resolve to make this holiday season less about money and more about important things. Focus on the difference between the meaningful and the meaningless. That might be time with your family, a donation to your favorite charity, your faith, or many other things. Most of these are not measurably by money, tend to cost less, benefit others more, and come with huge personal rewards and satisfaction.
Speed kills – it’s not just a traffic rule, but also includes your impulse purchases. It will always cost you more money if you don’t take the time to shop around or consider some alternatives. But this also means you can’t start your shopping on December 23rd. It’s a guaranteed way to have a small selection, no sales, big price tags and a sure-fire debt hangover.
Just say no – set a point where you’re done. No more “just one more thing” or “I should also get that.” It gets harder when you have kids, because they’ll see hundreds more commercials for stuff they “have to have” between now and December 25th.
Make a list and check it twice – it works for Santa, who is the biggest shopper this time of the year, so discipline yourself as well. Don’t leave the house without a list and a good idea of what you’re looking for, as well as a price range. Cruising the stores is frustrating and many people tend to just buy something – anything – just to get on with it, and that’s never a budget smart way to make purchase decisions.
Wrap it up – keep the receipts for all your spending during the holidays and make a note of it for next year to get smarter and better prepared for 2008. You’ll also need to get a game plan for paying back your holiday spending as early as possible next year. What will that take? No dinners out, skip the movies or some overtime at work? After all, if you just pay the minimum payments on a $2,000 credit card, it’ll take almost 15 years to pay it off and the last thing you want is someone wishing you a Merry Christmas next July when you’re still paying off your debts!
So what’s the best Christmas present you can give yourself this year? Cut up all but one of your credit cards, stop rate surfing, which is just moving them around, and start paying the balance off in full. Resolve to work towards your debt freedom in 2008, instead of another year of treading water. Resolve to do more of what works and less of what doesn’t.
It’s worth it – you’re worth it – and it’s the greatest gift you can give yourself and your family.
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