Holiday Debt Hangover

Dreading those nasty credit card bills?Here's how to get your finances backon track after the holidays.

of how much you’ll need to save, look at how much you spent this Christmas and divide the amount by 52,” suggests Hunt. “That’s how much you’ll need to put aside every week.” If you really went way over budget and plan to scale down your gift giving next season, Broussard adds that if you save $3.33 a day — less than the cost of a latte — you’ll have $1200 in cold cash by next Christmas.

Leave the plastic at home, says Fairley, author of Cash in the City: Affording Manolos, Martinis and Manicures on a Working Girl’s Salary (John Wiley & Sons Inc.; $14.95). “Consider cutting up your credit cards and operating on a cash basis,” she says. “To me, credit cards are like crack cocaine.” If doing without your charge card is unthinkable, you may want to take Stephens’ advice. “Consider reducing your line of credit — you’ll spend what they’ll allow.”

Shop in the off-season. “If your state has a tax-free shopping day, take advantage of it and do your holiday shopping then,” says Lawrence. You can also snap up bargains at back-to-school and end-of-season sales. Fairley looks for small gifts, ranging in price from $5 to $10, throughout the year. You’ll also find bargains on the Internet, says Hunt. And next year, once you’re solvent, you can take advantage of after-Christmas sales!

Remember the reason for the season. “Christmas is a time of remembrance,” says Pulley. “We celebrate the holiday by spending it with our family and treating it as an extension of Thanksgiving,” says the mother of three. Instead of lavishing their friends and family with expensive gifts, the Capers have an annual holiday dessert party — and yes; they do include the expenses on their holiday spreadsheet.

“Give practical gifts or offer to do things for each other,” suggests Stephens. “A friend of mine helps me with office work and computer stuff and I give her 10 babysitting coupons.”

Don’t forget to consult your other half about how you plan to celebrate the holiday — and about how you plan to avoid going into debt throughout the year. While Dana, who is a bank vice president, has always been careful with her money, it took Marty a few years to get with the program. “When I was single I spent a lot on Christmas — $1,000 was nothing for me,” says Marty, 40, who is a respiratory sales representative for a pharmaceutical sales company.

Today the couple shops for the holidays together, but it took a while for them to get on the same financial page. “It was tough for me to cut back, but my priorities changed when we got married and began building a house, paying off debt, and planning for the birth of our daughter, Tara, who is 21 months old,” says Marty. He came into the marriage with almost $5,000 in credit card debt with 18% interest, which he promptly paid off by using money from annual bonuses. He also got rid of his car, which means the couple only

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