1

Make a holiday-spending budget.
And stick to it. Include all the costs you might incur during the holiday season: gifts, decorations, travel, greeting cards and postage, entertaining, special clothing, etc. We often overlook the “associated” costs of the holidays and focus only on gift-giving. However, when you consider all the costs incurred, the total can be staggering.

2

Don’t shop at the last minute.
Waiting until the last minute to shop encourages impulse buying and haphazard tracking of your spending. Both of those can bust a budget in short order. More than 40 percent of Americans start their holiday shopping before Halloween, according to a survey by the National Federation of Businesses. Another 37 percent start in November. The rest are evenly split between the first two weeks and last two weeks of December. If you’re in either of those last two groups, try to get an earlier start this year.

3

Use cash instead of credit.
If at all possible, avoid paying with your credit cards when making holiday purchases. A dreaded “debt hangover” from rampant holiday credit card spending is a bad way to start a new year. Instead, keep to your budget and use your debit card for holiday spending. Not only is it easier and safer than carrying around a wad of cash, in many cases your debit card offers purchase protection and reward points just like a credit card.

4

Be smart if you must use credit.
Not everyone has the luxury of using cash for holiday spending. If you must use credit, though, be smart about it. First – if you know you won’t be able to pay off the balance immediately – know which of your credit cards has the lowest interest rate, and use that one. In no case, however, should you purchase more than you can pay off in a couple of months. It’s also a good idea to use one card exclusively for all your holiday purchases. Doing so will make it easier to track your spending.

5

Save throughout the year for the holidays.
Whether it’s a traditional Christmas Club account or simply funding your regular savings account a set amount each month for the holidays, socking away your funds throughout the year will help you avoid scrambling for money when you need it. And, again, using cash instead of credit will likely save you money in interest charges and make your new year debt hangover-free.

6

Set spending limits, draw names, etc.
Many people find themselves locked into the habit of buying expensive gifts for several relatives and friends each year – often spending far more than they can afford. Instead of continuing to dig a money hole each holiday season, why not get together with family members and friends and establish a reasonable spending limit on gifts? Or, better yet, draw names so that each person only has to buy one gift for one other person in the group – and set a limit on that gift.

7

Consider giving homemade gifts, or services.
Most of us cringe at the thought of receiving yet another ugly necktie or bottle of cheap perfume. Instead of giving a store-bought gift that may be of little use to someone, think creatively about giving a homemade gift, or a “coupon” for a much-needed service. Most parents would love such a coupon for a couple hours of babysitting, or a dinner out with friends. And who doesn’t love to receive a homemade pie or cake – or even a smoked turkey – during the holidays? Use your imagination, and you’ll probably end up saving money while making your gift recipients happier.

8

Keep your perspective on what the holidays are about.
Our culture has become so consumer-crazed in recent years that many of us have lost sight of what is most important, and most meaningful, during the holidays. Work hard to maintain your perspective on the true meaning, and the true gifts, of the holiday season. Instead of focusing on consumption, we could all benefit from a renewed focus on the joys of spending time with family and friends, and of celebrating our religious beliefs.