Did you originally think that you can manage spending this Christmas? Were your costing estimates just few hundreds of dollars? As a result weren’t you doing any extra savings or preparations for it during the year?

And now you ended up with another debt of few thousands of dollars that will take perhaps more than a year to pay back? If you go like this every Christmas, well, you are asking for a debt trouble in few years down the road.

Good news is that there is a way how to avoid it! No, I am not going to talk about the need to save $20 each week during the year. Neither about supermarket saving cards nor companies like Crisco.

By the way we believe that these sorts of companies offer a terrible deal. You set aside 20 or 30 dollars each week and what you get at the end is not really worth it.

Stay away from Christmas saving schemas

You may have noticed last year (early in 2012) a TV documentary about Crisco-like companies. For your hard earned money and savings you get low quality products. I remember the ugly overpriced meat one family got. It was way more expensive than if you just bought similar but better and fresher produce in your local supermarket.

So no, we do not recommend any Christmas saving schemas of this kind. There are much better ways to approach this problem. Off course, the easiest and most effective way would be saving those extra $20 or $30 each week during the year. But first, let’s address some common issues.

Are your Christmas savings, the only savings?

For many people that can be a problem. They regularly save for couple of months and then something unexpected happens. Your car breaks down and needs fixing. Or some other appliance or house fitting fails and needs replacement. There are so many other things that can happen.

If the Christmas savings are the only savings you have then well, it’s highly likely that you will have to use it. If this happens then there is nothing or very little that remains for the Christmas.

Consequently when the happy time of the year comes, the only way to address the problem is taking some extra loans to cover all the season’s needs.

Seasonal expenses add up

And I am not talking just about food or Christmas decoration. The biggest Christmas expenses as you surely know are the Christmas gifts. Yes, I know, you have probably made many resolutions about how you won’t be buying any expensive presents this or any previous year.

And what are the results? You know for yourself, I probably don’t have to remind you of that. In short, you ended up with few thousands of dollars of new debt added to your existing debt portfolio.

But what then are the other ways that can help you not to fall in this kind of Christmas debt trap? How can you cut down on your expenses? You may have heard of few traditional recommendations.

Some usual tips for staying afloat

1. Stop buying Christmas presents for your extended family

We mean people like uncles, aunties, cousins and their partners and children. It’s best to limit the circle to your core family – that means the spouse and kids. Perhaps parents as well, but that’s it. If you really must buy gifts for anyone else, buy something of a symbolic value.

Go to $2 shop and buy something little there. You can wrap it nicely and no one will know that you paid just few dollars for it. At the end what matters is not the monetary value of a gift. It’s the fact that you took the time and thought about that person.

Don’t be afraid of any negative reactions. Perhaps you may suggest to your extended family to give each other just small gifts. If they are reasonable they should understand.

Actually, they may feel the same way as you, just were always afraid to suggest it by themselves. There is a big chance that they will be glad you suggested it first.

2. Buy useful presents, not dreams that cost a lot

Always wanted the latest iPhone or new Ultrabook? Are your kids mourning about that great remotely controlled helicopter or autodrome? Does your wife keep talking about that diamond ring for ages? No, Christmas is not a good occasion to buy those things.

Problem is that everyone wants something, ideally something really big and memorable for the Christmas. The problem here is that all these desires come at the same time. Then off course that your wallet cannot handle it all.

Try another approach. Tell everyone upfront that this Christmas they are not going to get any big ticket items. Instead buy something useful. Like kids uniforms for next year or some stationery. You will see how much relief this will bring you in few months’ time after the school holiday!

Other useful things may include clothes or other items for everyday use that you needed to buy anyway. Use Christmas as an opportunity for to buy useful things, not extraordinary ones.

However, under useful clothes I mean normal stuff, not designer brands! And don’t overdo it – clothes can get pretty expensive too. Generally speaking, go for basic things which were already overdue for some time.

When it comes to those big items and you don’t want to discard them completely then do this: Consider leaving them for other occasions like birthdays and the likes. These dates are usually spreaded across the year more equally.

3. Do you really need that turkey, ham and all the chocolate or sweets?

Many people stock up on Christmas like it was going to be the end of the world. Well, for Christmas 2012 you have the one-time excuse with all the Mayan calendar hype around it. But, if it won’t happened then the next year you can’t use this reason again.

And by the way, people have constant need for nutrition. There is no rational for Christmas overeating. If you want to treat yourself a little extra during Christmas, set aside relatively small amount, let’s say $100 and buy any extra food only up to that amount. Not a single dollar more. And don’t do impulsive food purchase either.

Never go food shopping for Christmas (or any other time) while hungry. It will just make you buy more stuff. Also, in the weeks prior to Christmas when you do your normal grocery shopping just start noticing the new Christmas theme products.

If you particularly like some and want them for the holiday season, mark them down on a piece of paper, including their prices. Later, just before your main Christmas shopping, go through the list and pick items you really want. Within your pre-set budget, off course.

See, that was easy! Now you will spend only so much. You save money and get other benefits, too. Most important are probably related to your health and weight. This simple action will bring you triple benefits. It’s really worth it!

4. Stop watching TV about 2 months prior Christmas

Yes, you heard right! Stopping watching TV can be the biggest and most important factor helping you to avoid Christmas debt trap. This year we were unintentionally not watching TV for the last few months.

Not because we specifically wanted not to. It was just a coincidence. We had few new DVDs, so instead of normal TV programmes we watched those. Then we spent quite a lot of time on our PCs. Actually PCs and internet use is becoming large substitutes for TV lately. And it has some positive side effects.

What I mean exactly by that? Well, keep reading. About 2 weeks before Christmas we “accidently” turned on the TV on Saturday. And this was almost a big mistake. Why? Well, you may have some clues now. It was the types of commercials and TV ads they run in the week prior to Christmas.

One example: “Buy bla-bla-bla and pay no interest and no repayments until March 2015”. Yes, you heard right. Pay no interest and no repayments until March 2015. That’s more than 2 years! It’s extremely powerful and dangerous marketing campaign.

Even if you consider yourself financially conscious, you can very easily fall for it. Imagine, you get stuff now and don’t have to pay a dime for more than 2 years!

There are many people who realistically can’t take any new loans now because they couldn’t afford the repayments. But in 2 years’ time many loans will be paid off. Then it will be possible to add some extra repayments to your outgoings schedule.

And it’s you, who is more or less financially responsible. But what about your wife (my apology to financially frugal females)? And what about your kids? You may have used excuses before, like the one that you won’t buy this-and-this because you can’t afford it.

But if payments are deferred for more than 2 year then it becomes harder to reason with your kids. They will just keep shouting: “But dad, there are no payments for more than 2 years! You can surely afford that!”

I had to quickly turn the TV off. And keep it shut at least until the second week after the New Year. Why so long? Don’t forget the Boxing Day deal!

Many people successfully resist Christmas madness but then get hooked shortly afterwards. Remember that the Boxing Day and End of The Year sale deals are often even “better” than the Christmas deals!

Great Danger of Deferred Payments Deals

Long term deferred payments finance deals are very dangerous. They are extremely catchy and easy to fall into. But statistically they are also the deals that are causing the most defaults and bankruptcies. Two years’ time seems so distant that it won’t bother most people now.

And often they sign not just for one but many such deals. You may think that things get better later. You hope to repay current existing loans faster, get pay rise or somehow improve your financial position in few years’ time. That may or may not come.

When the time comes to start repaying those deferred payment deals, many people simply can’t afford the payments. Even if they don’t lose their jobs or income in the meantime, the extra repayments bring unbearable burden with it.

Did you know that most filings for bankruptcy occur in March and April? That’s usually the time when these kinds of Christmas deals repayments kick-in. Don’t be one of them the next or the following year.


In this article we presented you with a handful tips and tricks how to avoid Christmas financial rush. Try adopting at least some of them, if not all of them. Your loved ones may feel a bit of disappointment because they big dreams will not be fulfilled. Well, at least not immediately.

But the reward for you and your family will be sweet later down the road. Try it once and we guarantee that it will become a new habit.

Did you like our tips and recommendations? Have you got your own ones? We would love if you shared your opinion with us and other readers in the comments.

Posted on: September 13, 2017
Categories: Articles

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