Will you be naughty or nice to yourself? The top item that can add debt to you when shopping for Christmas is to do so without a spending plan. It is imperative that you have a line item in your monthly spending plan for gift giving all year round. I’ll tell you a little secret to help you make sure your gift giving item in your plan is properly funded and you don’t end up robbing your emergency fund on a gift you forgot. It isn’t a surprise or an emergency that many people celebrate Christmas as a gift-giving holiday on the 25th of December every year. So ALWAYS have this item in your spending plan.
Here is a simple example to illustrate a hypothetical plan. If you are a family of four, two parents and two children, and you are lucky, are you have two sets of grandparents, we have 8 people to buy for. If we plan to spend $120 on each child, $25 for each grandparent, and the parents plan to spend $60 on each other, then the calculations work out like this:
| Kids | $120 X 2 = | $240 |
| Parents | $60 X 2 = | $120 |
| Grandparents | $30 X 4 = | $120 |
| Total to save for Christmas Spending Plan item | $480 | |
| Monthly allotment to save | $480 / 12 | $40 |
Of course, this plan needs to be adjusted to each individual situation. If the plan isn’t followed it can’t help you. So once you have established one that works within your overall spending plan. “Locke” it in and commit to sticking to it!
