Plan Now to Have a Happy, Debt-Free Holiday

holiday gifts
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Military families are preparing for the holidays early. And, the first deadlines to send gifts to servicemembers stationed overseas are fast approaching. As you get ready for the holidays, if you plan to join the majority of Americans who will search for ways to cut costs, check out this list of tips:

1. Budget first. Before holiday tunes jingle away your willpower, think practically. Calculate how much you can and want to spend for holiday festivities. Then compare that total to a list of everything you anticipate spending on this holiday season. Include:

  • Everyone you'll give a gift to and how much you plan to spend.
  • Cards and postage.
  • Decorations.
  • Entertaining, including food, drink, special garments, child care, etc.
  • Year-end tips for newspaper carriers, babysitters, housecleaners, doormen, hairdressers and other service providers.
  • Gifts for teachers, doctors, neighbors or others close to your family.
  • Travel costs.
2. Get organized. Keep a copy of your list in your purse or wallet. When you see the right gift at the right price, check it off and stop shopping for that person. At home, designate a closet, empty chest of drawers or laundry basket as a holiday gift repository. Tape your list to the top, and check off recipients whose gifts are in the bag. If you enjoy wrapping gifts, save them up to finish just before the holiday. If not, wrap as you go — just remember to label each gift.

3. Find willpower online. Avoid the temptation of store displays — as well as the hassle of fighting over the last must-have toy — by shopping online. Shipping really adds up, so you'll save a bundle if you find free shipping to out-of-state family and friends. If you're tempted to surf from site to site, becoming distracted, set a timer with a limit for placing your orders.

4. Plan holiday tips. Tipping is a nice way to thank people for their service and support. However, be sure your tips fit within your budget. If you lack the funds to hand out checks to service providers, keep it simple. Decide on a plan — two kinds of delicious cookies, perhaps — and spend an afternoon in the kitchen. Package cookies in attractive containers (ideally something that can have a useful second life, like a large travel coffee mug) and hand them out to the mailman, teacher, trash collector, etc.

5. Get help if you need it. If your family has a deployed servicemember and you struggle with how to afford holiday gifts for your children, get in touch with your local branch of Operation Homefront, which launched a holiday toy drive for children of deployed military families.

6. Start your own holiday club. For next year, start a holiday savings account, offered by many banks and credit unions. If yours doesn't have one, you can do the same thing yourself. Set up direct deposit so that each month a portion of your paycheck is deposited into a separate savings account. Be sure to use self-control: Don't spend the money unless it is for holiday items.

This year is an especially good time to remember that when it comes to giving, it's the thought that counts. But even those on tight budgets can have a festive holiday — and stay out of debt — with some careful planning. Now is the time to begin.

For more financial tips and advice on building your savings, visit's Personal Finance channel.

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