Everyone gets excited by the holidays, and for many of us, that excitement translates into overspending. One of the many contributing factors to financial distress is holiday spending, and sometimes that financial distress can lead to personal bankruptcy. Whether you see bankruptcy in your future or want to stave off debt, prepare now for holiday spending.
Financial discipline means more than saving for the future, setting retirement goals, or setting up a college fund for your children. Financial discipline at the holidays for many Texas families means working together as a team on a common challenge: preventing exuberant spending on gifts, entertaining, and decorations.
If you normally buy, buy, buy for a long list of family members, friends, neighbors, not-so-close acquaintances, and office coworkers, a first disciplined step can be cutting back the list. Pare down the gift list and boost the holiday card list:
- Substitute greeting cards for gift cards
- Make a thoughtful craft instead of buying another kitchen gadget
- Trim down the mailed greeting cards, too, to save money on postage, cards, and envelopes
You can also scale back the gifts. Substitute an inexpensively framed photograph of you and your neighbor for the pricey gift basket to that neighbor. Swap sincere, hand-written “thank you” notes for $20 bills in money holders for your mail carrier, package deliverers, and newspaper delivery person; you can save hundreds in an afternoon.
Take some of the competitive pressure off large family gatherings by substituting “Secret Santa” swaps for buying gifts for three siblings, 13 cousins, nine aunts, and so on. Here's one way to run it, according to the experts at Simplify, Create, Inspire:
- Adults write down their full name and one or two wish list items
- Remember this is not for the kids, a crowd that includes a lot of “believers!”
- Set a spending limit ($50, for example)
- Names are tossed into a hat and each relative draws the name of one adult member of the extended family
- Buy one gift based on the person's wish list or your own inspiration, instead of buying a roomful of gifts for every relative
Work with your loved ones to decide on the quantity of gifts for everyone. If your family tends to go overboard, consciously scale back. Perhaps your generosity could be better expressed by giving immediate family members one thoughtful gift each, and then the entire family could make a single, affordable donation to a local charity.
The folks at Real Simple have a useful tip for stressed-out hosts and hostesses this holiday season: give it up! Swap out virtual visits for long drives to relatives' homes. Reduce your own holiday party from 100 to 25 guests, and ask each guest to bring something fun and tasty.
If you feel compelled to have a holiday party, avoid panic shopping for the latest decorations and trendy food. If in past years you prided yourself on having the house already decorated for the guests in past years, stand that idea on its head and have your guests decorate your tree, Kwanzaa table, mantle, or Hanukkah centerpiece. They'll keep their hands busy and get to know each other in a fun way.
Planning also means putting the breaks on impulse purchases. Agree on a dollar limit beyond which every purchase requires a 24-hour waiting period. Use your debit cards, not credit cards, when buying gifts to avoid post-holiday spending blues.
Adopting a realistic outlook could be the greatest gift you give or get this holiday season. Look back at your personal finances. Prepare a budget based on what you have and anticipate having in the bank, not what your credit cards can handle. Stick to the budget!
Be willing to compromise with your own lofty gift-giving goals. Prioritize your spending and the people you spend time and money on. Spouses and children must top your “Nice” list. Everyone else — extended family, neighbors, service providers, friends — can get by with a little less, since you are not their only source of generosity.
The post-holiday blues almost always involve regret and debt. If you apply financial discipline, plan wisely, and take a realistic look at your situation, you can avoid going deeper into debt. You can avoid facing January bills. Give your family the double gift of a worry-free holiday season and a financially secure New Year.
WORK WITH A FRISCO BANKRUPTCY ATTORNEY
As we have seen, discipline, planning, and realism are all needed to avoid spending too much money over the holidays. The staff and attorneys of The Page Law Firm all understand how important the holidays are to our clients, but we also appreciate the risks of impulse spending, controlling your personal finances, and staying out of debt. When the unexpected happens, turn to an experienced Denton County bankruptcy lawyer for help. Contact us today or telephone 214-618-2101 to schedule a free consultation right away.