How to Avoid Holiday Debt While Still Enjoying Christmas


Many people suffer holiday hangover in January from overspending during the holiday season. If you are one of them, it only requires a little planning to avoid it.

You need to personally decide what is the most important, enjoyable activities of the Christmas season. Once you have determined what those are, you will be able to prioritize your time and money to avoid overspending.

Next you need to develop a realistic budget. Categories can include gifts, food, entertaining, and decorating. Once you know your budget, you can then formulate a plan. Make a vow to only pay cash for expenses. By not using your credit cards, you avoid the dreaded January bills.

Gifts are usually the biggest expense. While it is great to go all out, who wants to be paying on toys the kids have lost interest in come January. Ask everyone to make a wish list and have them to prioritize the list by numbering from most to least wanted. Emphasize you will not be purchasing everything so they need to think carefully about what they really want.

Some families avoid toy overload by limiting the number of gifts to something to wear, something to read, something needed, and something to play with. Others use the religious aspect of the season and limit gifts to three as a symbol of the gifts brought by The Three Wisemen.

For individuals outside the immediate family, determine if you are gifting because you feel obligated or if it really has meaning for you. Find out what people would like as gifts. Older individuals may enjoy consumables such as food or gifts of your time. Find out what people collect or what is special to them.

One avenue for finding affordable gifts is to visit resale and consignment shops. Many people dispose of new or nearly new items that look brand new and still retain their retail tags which you can then purchase for a fraction of the cost.

If you enjoy entertaining, consider hosting a tree trimming party. Invite friends to help decorate and provide cookies and hot chocolate. Another idea is to host a progressive dinner with several families where each one is only responsible for one course of the meal. You may also consider hosting a dinner where everyone contributes a dish.

One thing you can do is to spend your time instead of money. Take hot chocolate in a thermos and drive around looking at holiday lights. Find local plays and events you can attend. If you prefer staying at home, pop popcorn and watch a classic holiday movie like “Rudolph the Red Nose Reindeer” or a more modern one such as “National Lampoon’s Christmas Vacation.” Consider reading a holiday themed book each night to your children.

If you enjoy baking cookies and making candy, but do not enjoy paying for all the ingredients consider hosting a cookie exchange. Each person only has to make one kind of cookie or candy, but when exchanged will have dozens of different cookies and candies to enjoy. Baked items also make great gifts.

Decorating can be done inexpensively. Look for items around your house that can be re-purposed for the season. A beautiful red scarf can be used as a tree skirt. Ornaments can be hand cut snowflakes. Homemade dough ornaments add a homey touch with breaking the bank. If you have children, use some of their small toys as safe and simple decorations.

Look around for ways you can serve others during the season. These activities can include visiting residents at a local nursing home or serving in a soup kitchen. It could also include visiting with your neighbors or hosting a modest dinner for friends who are unable to spend time with their families.

Debt does not have to be the norm for having an enjoyable Christmas season. A little forethought will go a long way in avoiding the headache of January bills.

This post was written by

jason – who has written posts on Budget Clowns.
Father of three and married to a lovely women. Always looking for ways to save money, and invest it properly for my children's future.

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