With Christmas just around the corner, our focus is slowly starting to shift from our work commitments to Christmas and with it comes the annual Christmas spending spree.
Unfortunately many families don't set a Christmas budget and they rely on their credit cards to get them through the festive season.
Shortly after Christmas these same families will also develop symptoms of the "Christmas Giving Blues" which can include an upset stomach, lack of sleep and anxiety.
You know that feeling. You spend up big, charge it on the card, and then spend the next couple of months worrying about how you are going to pay off your Christmas debts while vowing never to let this happen to you again.
Unfortunately, this is a reality for a lot of families every Christmas and they just don't seem to be able to break out of the cycle.
This year, give yourself and your family a Christmas gift and take the "Christmas Budget Challenge" and enjoy your Christmas without the suffering the Christmas Blues.
There are two parts to the Christmas Budget Challenge:
1. Put in place a strategy that will help you survive Christmas with as little pain as possible.
2. Put in place a strategy that will give you a plan to enjoy your next Christmas. This plan will also run itself without you even thinking about it.
Let's start by putting in place a plan that will hopefully make this Christmas a little easier on your hip pocket:
1. Have a look at your finances and set an upper limit that you can afford for your Christmas spending. Allocate a certain amount to Gifts and a certain amount to other Christmas expenses. This is the start of your Christmas budget.
2. Leave the credit card at home and pay for Christmas with money wherever possible.
3. Keep track of all your Christmas spending. A good way of doing this is by carrying a small notebook and pencil and writing your purchases in it.
Gift Buying
4. Call your relatives and agree that Gifts will only be purchased for the children
5. Take your Christmas Gift budget that was allocated in step 1 and divide it by the number of gifts you need to buy. This number will be the maximum you can spend on each gift.
Christmas Food Shopping
6. Take your Christmas Dinner budget and make a shopping list.
7. When you are doing your shopping use a calculator to make sure you stay within your Christmas budget.
8. Save money by looking for the cheaper priced goods on the top and bottom shelves. Try not to buy items that are on shelves at eye level, these are usually the higher priced items.
9. Try not to buy items that are located in the displays at the end of the shopping aisles, these items are usually more expensive than the items located in the aisles.
10. Compare prices of similar items and buy the cheaper item.
11. Remember that Christmas is only one day a year. You don't have to spend a weeks worth of grocery money on one day.
12. Ask each relative to provide a food dish, drinks or dessert.
As soon as Christmas is over and the pain is fresh in your mind. You need to take action and put in place the second part of the "Christmas Budget Challenge". This next step will ensure that you have enough money for next Christmas
1. Add up all your Christmas expenses including gifts, food and any other costs.
2. Take the total of your Christmas expenses and divide it by the total amount of pays until next Christmas.
3. Open high interest bank account with the following attributes:
- No minimum starting balance
- Interest is accrued daily and billed monthly
- Interest rate on this bank account must be higher than the inflation rate.
- No bank charges
ING Direct and Citibank have an online banking account that may be suitable for your Christmas Budget account.
4. Organize an automatic bank transfer from your bank account to your Christmas Budget account. This transfer will be on each payday for the amount you worked out in step 2. It is important that this is automated because most people will not stick to this plan if it is a manual process.
5. When next Christmas comes around withdraw your money and repeat the process again.
You can get a free excel "Christmas Budget Challenge" spreadsheet from http://www.my-wealth-plan.com/christmasbudget.zip. Use this spreadsheet as a template for your Christmas Budget,
This plan is very simple and surprisingly effective and you will be able to enjoy your next Christmas without the suffering the Christmas Giving Blues.
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