Good Taste / December 2006
Ti$ The $eason
The holiday season may be a joyful time of sparkle and snowfall but it can also mean a merry-go round of stress and spending. Last minute shopping, “obligation gifts” and the effort of ignoring a billowing credit card balance can leave a woman wondering where the joy went.
From a personal finance standpoint, Christmas can be a nightmare, according to financial planner Diane McCurdy, “Typically Americans are now spending 130 percent of their disposable income. The holiday spending frenzy can yield an unhealthy and often paradoxical mix of entitlement and resentment, combining sentiments of ‘My family deserves a big Christmas!’ with ‘I can’t believe I have to spend $250.00 on groceries and cook all day again!’”
McCurdy recommends making a spending list based on hard numbers, not emotion. She says, “Look at Christmas preparation as a time to get a better handle on overall finances. With hard numbers in front of her, a woman is much less likely to overspend out of guilt or desperation or just simple ignorance of how much she’s already spent.”
If crunching the numbers brings bad tidings, she says, “Accept that you’re going to have to downsize. If a woman is already in debt, digging the hole deeper is no solution. And, if having an extravagant holiday is important, plan for one next year. Then, be sure to create a Christmas budget and include all Christmas expenses, not just presents-the tree, decorations, greeting cards, meals and new outfits. Shop throughout the year. Buying early helps avoid gift-buying panic, a prime culprit in overspending. Besides, the cushion of time allows for more thoughtful choices. People often end up buying several gifts for the same person because they’re rushed and don’t feel good about their first choice. Also, holiday sales and promotions are enticing. Shop early and avoid both traps.”
Breaking the holiday spending tradition requires a little preparation or there can be some awkward moments at gift giving time. “Just warn your family in advance-send a mass email, make some phone calls, or have a face-to-face discussion with the usual celebrants well before the big day.”
If the extended family wants to cut back, try money-saving ideas like drawing names, setting price limits or a gifts-to-kids-only policy-or any combination of the three. If the group decides to forgo gift-giving entirely, McCurdy says, “That’s fine! Just be sure to come up with some activity to replace the annual gift-opening ritual. If you don’t plan something, the day may feel strangely hollow.”
Make the holiday feast a potluck event. “There’s a lot to be said for having everyone under one roof at Christmas. But if it’s your roof, the stress and expense can override the fellowship. Spread the work-and the cost-around”, advises McCurdy. “Have everyone sign up to bring a dish or a drink. And when the meal is over, put on the Christmas music and give everyone a clean up task!”
For presents, she says, “Think edible, biodegradable, readable or homemade. Most people suffer from Too Much Stuff Syndrome! Don’t contribute to the clutter. Christmas cookies, a nice bottle of wine, a beautiful candle, or a good book are generally inexpensive and won’t be shoved in a closet somewhere. Creative homemade gifts can be delightful, too. Your time can be the best gift of all.”
Consider Christmas activities instead of Christmas stuff and allocate money and time accordingly, says McCurdy. “Take children to see The Nutcracker rather than spending money on another toy. Money and time really are connected. Spending too much means worrying too much, not relaxing and not enjoying free time. Working longer hours to pay post-holiday bills means even less free time.”
There’s no reason for women who genuinely love and can afford the holiday shopping, decorating and gift-giving to give them up, but silent sufferers who dread the spending and stress of holiday merriment should take a deep breath, have some eggnog and start simplifying the season.
Diane McCurdy, CFP, is the author of "How Much Is Enough? Balancing Today’s Needs with Tomorrow’s Retirement Goals."
Copyright © 2007 A Woman's View. All rights reserved.
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