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7 tips to beat the post-holiday debt blues

Holiday debt
Highlights
  • Seventy-nine percent of consumers plan to spend less on Christmas this year.
  • A mantra can help you focus on what's important and stick to your budget.
  • Avoid shopping malls, online shopping and TV shopping to spend less.

The stores are decked out in red and green. The shopping season looms large. And retailers are hoping for more growth in this year's holiday spending than the anemic 1.1 percent year-end expansion they recorded last year, according to the National Retail Federation.

But those hopes may be disappointed because many consumers are cash-strapped and don't want to incur more debt, holidays or not.

The new urge to not spend is so pervasive that 79 percent of the people queried in a recent StrategyOne survey said they plan to spend less on the holidays this year.

If you're determined to escape the cycle of holiday overspending, here's how to do it:

1. Make a budget. "The more you plan, the less you spend," says Ellie Kay, a family financial planning expert in Palmdale, Calif. It's not enough to just set up a budget. You'll also need to keep track of how much you've spent and re-evaluate your list along the way.

2. Hold a family meeting. Discuss your holiday shopping plans with your family and try to voice your concerns in terms that everyone can understand, Kay suggests.

"Explain to your children that you have a budget. 'We don't want to get into debt, and if we overspend on Christmas, we can't take that vacation next summer,'" she says.

Bonus tip: Don't use gifts to compensate for working-parent guilt or compete for blended-family affections.

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3. Make it meaningful. Think about how you want your loved ones to remember the holidays and try to create those positive impressions, says Rebecca Schreiber, a Certified Financial Planner at Solid Ground Financial Planning in Silver Spring, Md.

"What sort of kindness do you want to introduce into your life that will be your theme for the holiday?" she asks. "It could more volunteer work or sending out cards to all the people you've been meaning to get to, that will relay that you care and that doesn't necessarily come from the mall."

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