5 ways to holiday-proof your budget

By Maryalene LaPonsie

For the Deseret News

Published: Friday, Nov. 8 2013 12:43 p.m. MST

In this Thursday, Dec. 13, 2012 file photo, shoppers walk past a Macy's at the Downtown Crossing in Boston.

Charles Krupa, Associated Press

Enlarge photo»

Editor's note: This article ran originally on MoneyRates.com. It has been reprinted here with permission.

If you had to pull $738 out of your bank account right now, could you do it? If not, it is time to start thinking seriously about how you plan to pay for the holidays.

According to the National Retail Federation, the average holiday shopper spends $738 on gifts and seasonal items. Yet according to a recent Google Consumer Survey conducted by TransUnion, 64.3 percent of Americans say they will enter the holiday spending season with no money saved specifically for it.

If you have exactly zero in your savings account for holiday purchases, take heart.

"It is never too late to save or make a change in your financial habits," says Julie Springer, vice president at TransUnion. "In terms of holiday savings there are still several weeks or pay periods left and people can still put aside a little each week to ease the focus on December or January payments."

To stop a January debt hangover before it begins, a trio of financial experts -- Springer, Barbara Van Buren of the Consumer Credit Counseling Service of Greater San Antonio and best-selling author Mary Hunt, whose books include "Debt-Proof Your Christmas" -- offer some of their strategies for getting your budget ready in advance of the holidays.

1. Determine where you stand

Van Buren suggests consumers start by getting a handle on their current spending and then pare down from there.

"The first thing consumers can do to prepare for the holidays is to write down what they are spending," says Van Buren. "Once they see where their money is going, then they can make adjustments so they can save for Christmas and other holiday spending."

Those adjustments could be anything from dropping your cable package to carpooling on your commute. However, Hunt suggests an even easier way to save a couple hundred dollars -- more.

"Let's start with the least extreme method," she says. "Many people have a supply of food in their home ... in their pantry and in their freezer. Yet we keep going out to buy more."

Hunt recommends skipping two or three grocery trips between now and Christmas and socking away the money for holiday spending instead. You may end up eating some unusual meals if you limit yourself to eating only what is in the house already, but it is a relatively small inconvenience in exchange for a debt-free holiday.

2. Rethink your Christmas philosophy

While you are making your list and checking it twice, you may also want to reconsider your overall approach to Christmas.

"I love Christmas, but we have to get real about it," says Hunt, noting many people can't even remember what they gave or received last year. "Why would you think about carrying debt for longer than you think about the gift?"

She suggests parents should focus more on ensuring their children have an evenly paced holiday celebration with family traditions spread across the entire season. In addition, Hunt believes parents may want to institute rules such as asking Santa for only one gift. Other ideas include offering experiences as gifts or having a Christmas for which no gifts are bought new.

"The gift is the messenger that you love them," she says, adding that the goal isn't to forgo gifts, but rather to put them in the proper perspective.

3. Start shopping now

Perhaps it seems counterintuitive, but shopping now may save you money later.

Springer recommends consumers keep an eye on advertising circulars and buy items from their gift list as they go on sale.

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