Debts and Christmas

"How many more shopping days until Christmas?" is an often asked question at this time of year. "Shopping", the spending of money, the use of credit and going into debt have become closely linked with celebrating this "joyous" season.

Unfortunately, some of us become so engrossed in gift giving that we give little thought to how we will pay for there gifts in the new year. Our society not only places the highest values on material possessions, but also provides us with the easy credit to make our desires come true. At Christmas time we can be lulled into being too generous with money that isn't really ours.

Once the season ends we are faced with debt on our Credit Cards that must be repaid within thirty days, or we begin paying back not only what we borrowed but another 18% - 28% in interest charges.

Keep in mind that if you could invest at 18% you would double your money in four years. Your Christmas gifts could wind up costing you nearly double the original price if you pay your Christmas debt off with minimum payments on your credit cards.

If we are going to be generous at Christmas time, most of us will have to plan ahead, if we do not want to face a heavy debt load.

We should first of all determine what we have left over each month to set aside for gift-giving. We can do this by calculating all our monthly expenses and deducting this from our net monthly income which will leave us with our discretionary income - income we can spend where we wish.

Next we should open a savings account into which we can make deposits from each pay. Twenty dollars per pay in an average 26 pay period year would provide $520.00 for Christmas, and $40.00 per pay,   $1040.00. It would be wise to have a family meeting to discuss the wants and needs of family members. We may find that we might want to spend a bit less so that we have fewer worries in the new year or start planning now so we don' t get into debt over something that should bring us "peace and joy.