Does a Christmas without credit cards sound like a dream to you? It doesn’t have to be one, especially if you start planning now for next year. So how do you go about it?
First, consider your Christmas list. Make a list of all the people you normally buy for and think about why you give them gifts. Is it because you want to because you feel socially obligated to, or for some other reason (such as an actual job requirement, maybe?) Strongly consider crossing off all of the people that are on the list out of social obligation.
Gift-giving should be done with joy, not because you feel obligated to. If you normally exchange with those people, let them know you’ll be scaling back next year and that you don’t want them to feel like they need to get you anything. They will not mind. Chances are they’ll be relieved to cross someone off their list too. Think for a moment about all the people that don’t buy you Christmas gifts. Are you upset? I’m betting not, and I bet you’ve never even thought about it before. My feeling is that for the most part, if you don’t know a person well enough to know what they might like, they don’t belong on your list.
Next, set a total budget and allocate it. Divide it into two parts: holiday preparations and gift-giving. Decide how much you want to spend for each of those parts, and then sub-divide accordingly. For the gift-giving portion, take out your Christmas list and organize the people on it into three categories: those you feel closest to, other family and friends, and everyone else (those you may want to give token gifts to). You might decide to spend $75 per person on the people you’re closest to, $30 per person on the next group, and $5 per person on everyone else.
It doesn’t matter what amounts you assign, as long as they don’t exceed your total gift-giving budget. And, there’s no requirement that just because you’ve allotted $30 for someone, that you must spend the entire $30. If you get a gift they would love for free or for $9.95, don’t feel obligated to add a second gift for that person so that things will be “equal”. Instead, congratulate yourself on your creativity in coming up with a gift for them that they would like.
Finally, start saving. Consider opening an online bank account and setting up an automatic deduction. It’s painless, and you won’t have to think about it again once you start. (In fact, it’s better if you just forget all about it.) If your total budget is $500, that’s $9.62 a week. When Christmastime rolls around next year, you’ll have a plan AND the money needed to carry it out. Another option is to buy a target number of gifts per month all year long, which has the added advantage of taking the urgency out of shopping.
If you find yourself tempted to go over budget and break out the cards (especially as Christmas draws closer) ask yourself this: how do I want to feel when I give this gift? Worry-free and happy, or stressed? If that’s not enough, try asking this: How would the recipient feel about accepting this gift if they knew I borrowed money to buy them a sweater? If you’ve already done it, don’t beat yourself up. Just start now, TODAY, with your new plan. The present is the only time to make a change, and that’s one great gift you can give yourself.