Planning For a Debt-Free Christmas Holiday

Christmas always seems to be far off until it is a few days away then we realize that we need a lot of cash to meet the suddenly bulging expenses. Ideally, you have 12 months to prepare for the next Christmas, but since this is often not the case, here are some tips and ideas on how to get well prepared within the remaining few weeks. Since you want to impress both friends and family alike during the festive season, you need to financially plan for how to cover all your holiday expenses without sinking deep into debt.

Determine Your Sources of Cash for the Holiday

christmas tree.Planning the activities to be done over the Christmas season and places to be visited is not really enough; you should also match all planned activities with their associated costs. When planning for the December holiday with just few weeks left, your approach should be done in reverse. In this case, start with the amount of cash you know you can confidently set aside for the holidays without affecting your monthly income allocation to essential utility bills. With not much time left to look for alternative sources of income to fund your festivities over the December holiday; you are safe and financially prudent to stick to a budget within your current income levels.

You can however increase your spending power during Christmas if you get one of the best credit cards in the market that will allow you to buy goods and services on credit. To reap the maximum gain from your other credit cards too, try to get all credit card balances run down to zero before the festive season. This can give you higher credit scoring which enables you to receive larger credit bands.

Outline All Your Expected Christmas Expenses

Santa in a red car.After determining the upper limit for your Christmas budget based on your income levels and amount of savings you can comfortably allocate to the festivities, list your expected expenditure. While listing expenditures, you need to consider all the activities that will happen during the week based on your past Christmas holidays and new developments in your life. For instance in the past before you got married you could have been celebrating your Christmas holiday with your mum and dad in your neighborhood; however, now you are married, you might need to travel with your spouse. Such new developments including having more children will inflate your costs and they need to be considered when you create the budget.

Among the common cost categories for your Christmas holiday are gifts, decorations, food, fun activities, donations and a miscellaneous budget. Gifts are a show of love and a way of sharing the joy of Christmas with your family members, co-workers, friends and other people with whom you have diverse relationships; hence they are always a priority in many families during the festive season. Decorations bring in the pomp and color that signifies the uniqueness of the festivities and stimulate the joy of friendship and family during Christmas. You would plan for decorations such as lights, a Christmas tree and candles among others.

Food is a key element of Christmas festivities and you want to make the experience a memorable one by serving your family, friends and any other quests you may have with the best dishes you can afford. Certainly the menu will differ from one household to the next, but a constant factor remains in thorough preparations and a budget for Christmas dinner and Christmas breakfast. You will also need to have snacks such as cake and candy for your family and friends. Part of the food could be donated to the needy if you have surplus, in addition to other household necessities such as clothes and toiletries.

Christmas at the beach.
Merry Christmas on the beach.

Finally, have all your fun activities during the holiday well covered and within budget. If you are planning to fly out of the country you should book your flights early enough and take advantage of the discounts offered by most airlines. If you choose to have fun activities such as Christmas movies, skating or skiing, try to do early booking; in order to both get a discount and ensure you do not miss out due to others booking ahead of you.

Matching Cash Available With Projected Expenses

In most cases, your projected costs will exceed your available cash for the holiday and you will need to find a way of making your holiday an exciting one; but remaining within your budget. Cutting down on expenses to the necessary ones should be your low lying fruit now it is only a few weeks to the December holiday. The process of eliminating non-essentials should go on until your expenses get down to the level of your available cash. This will then give you room to use your credit cards to pay for other additional costs that may arise during the festivities and still have a smooth financial transition into the New Year.