Preparing for a Debt-Free Holiday Season

Where has the year gone? Christmas is approaching faster than you think, and have you begun your holiday planning yet?  Are you freaking out? Don’t, there is still enough time to plan a debt free and joyous holiday season.

Here are five steps to for the last minute holiday planner who doesn’t want to go broke and be in debt.

Create a plan

Take time to create a plan for the holiday season to avoid debt. Do you want to have a big blow out party?  Or a cozy gathering of friends? Would you like to give gifts to a large number of people or a small group of friends?

Taking time to plan helps to create clarity and a framework for upcoming holiday gift giving and festivities.

Set a budget

Spend time thinking about what you can afford, set your budget and stick to it. Setting a budget makes it clear to you what you can and cannot afford.

Once you set your initial budget cut it by 25 percent just because you can and maybe should.

Use cash

If you set a budget and spend using a credit card that defeats the purpose (unless you pay it off immediately and get mileage points). Once your budgeted cash is spent — you’re done.

For example if you have a $1,000 budget for gift giving and dinners, take time to figure out who is getting what, how much you think your dinner party will cost and be honest about what you will actually spend so that you won’t go into debt.

Don’t buy new clothes for holiday parties

Do you find yourself invited to a number of holiday parties every year? Look in your closet and see what suits/cocktail dresses/etc. that you already have and repurpose those items. People typically don’t remember what you wear.

Use what you have

Double check your holiday decorating stash-Don’t spend money on items you already have. If you enjoy Thanksgiving decorations, Christmas sparkle, and New Year bling around your home look at what you already have to avoid duplicate purchases.

Spend time double checking your sparkling lights, your ornaments, and left over wrapping paper that you will be able to use that season.

Make staying out of debt a goal

Spending a couple of hours going through your closets, setting a budget, and creating a plan will take out a lot of the anxiety that many people experience when planning and preparing for the holiday season. Ultimately, the holidays are about spending time with family and friends, potentially eating too much food, and giving to those who are less fortunate than you. It’s not about going into debt.

Finally, embrace your creativity to craft a beautiful and memorable holiday season. There are so many ways to spend time with family and friends without spending money.

Go for a walk in the park, ride bikes together, host a game night, throw a potluck, have a holiday sweater night, set up a homemade photo booth, and the list goes on.

If you’re not the most creative person in the room, go to Pinterest for inspiration. You will find information ranging from how to decorate creatively, tips to save money, and more.

There is no reason to go broke or into debt this holiday season — even if you started late. Good luck!

This post was written by Michelle Jackson, a personal finance and lifestyle blogger sharing her story at The Shop My Closet Project. Her goal is to help people cultivate their best life. When she’s not blogging or podcasting for Girl Gone Frugal you can find her riding her bike, going for coffee, or hiking in the mountains.