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True Luxury: How to Have a Rich Holiday


Planning keeps costs in check.

By Amy McVay

Surprise! It's Christmas! (again...)

Christmas always seemed to surprise me when I was first living on my own. It would be about this time of year I realized that I needed to spend a large sum of money on gifts. It was an emergency, like having to buy a new set of tires at Sears (SHLD) after backing up over those spiked car gates. And after a while, it got very tiring being surprised by a date marked on everyone's calendar.

So one fine November (are there any fine Novembers, weatherwise?), I made a plan to handle the next year's Christmas. And, amazingly enough, it worked! No Christmas- related emergencies the following year.

It marked my first success in working a budget.

Christmas is the place to start if budgeting intimidates you. Unlike car repairs and other irregular large bills, Christmas is neatly scheduled. J.C. Penney (JCP) and other retailers offer plenty of reminders.

The best part is you control how much you spend. Our budget for the last several years has been $650, but yours may be more. (We try very hard not to scale up the holiday.)

The simplified circumstances of Christmas saving encourage success.

Financial Planning for Next Christmas in Three Steps

1. Decide how much you want to spend on everyone

You need to include everyone in thinking about your budget -- your sweetie, Grandma, the mailman. You don't need to figure how much you'll spend on each right now, just a ballpark on the whole season. You can figure out exactly how much to spend on weird Uncle Russ next year.

2. Divide by 12 -- that's how much a month you need to save

See, not too bad thus far.

3. Set up a direct deposit from your paycheck to an account with limited access

This is the most time-consuming part. We save for vacations using a savings account that requires me to physically go to the bank to withdraw the money. If you need a money plan that makes it hard to access your money, this is the way to go. If you're less naturally inclined to spend what's there, an automatic sweep into a money market or savings account will work, too.

Financial Triage for This Christmas

So you're saying to yourself, "Great, Amy, I can do a budget for next year. That does not get my tires fixed, uh, presents bought for this year." Let's look at ideas to save money now without resorting to your Chase (JPM) credit card.

Make this year's Christmas passable

For a very long time, I was looking to "wow" everyone at Christmas. Needing a "wow" translates into expense and stress. Make it your goal to do the minimum to get a "passing" grade this holiday season. Next year will be memorable anyway, what with your new Christmas budget. March on, mediocrity!!
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