Dream Series – 5 Steps to A Black Christmas

Cheesy as it may be, it’s a tradition.  Sometime in the next two months you will hear it.  “IIIII’m dreaming……… of a whiiiiiite… Christmas….”  Come on now, everybody loves a little Bing Crosby at Christmas.  As sentimental as a white Christmas may be, there are a lot of people dreaming of a black Christmas too…… or rather, a Christmas in the black.

christmas-presentsI think most of us dream of making Christmas magical for those around us.  There are a lot of ways to do that.  It could be anything from waking Christmas morning to find stockings stuffed and a new toy train going around the Christmas tree to a new tradition of Christmas on a warm, sandy beach under a palm tree.  Either way or any in between, it’s probably going to cost you.

First, let me say, I’m not inherently against spending money.  After all, you can’t take it with you when you are dead.  But I am a big fan of spending what you have rather than spending what you might have in the future.

This is where the “black” part of Christmas comes in – keeping your bank account “in the black” rather than “in the red”, or in the negative.

I stopped at the bank to make a deposit the other day.  I’m one of those that still like to walk in and chat with the tellers.  While working on my deposit, the very nice lady informed me of a special that was just beginning.  It was up to a $2,500 loan, as low as 3.99% APR, no application fee, with a 1-year term.  Better yet, there are no penalties for paying it off early!  It really is a decent loan at a very opportune time of year.  After all, it could make someone else’s Christmas a whole lot merrier.  It will also cost you more over the long term.

No, I’m not going to move my money elsewhere because they offer a loan.  After all, it is your money and it is your choice.  (So OWN your decisions!  But I digress…..)  When I did the math on this loan, borrowing $2,500 for a year will only cost you an extra $54.36.  Over the course of the year, that’s only an average of $4.53 per month in interest.  But that’s if you qualify for the best rates.  Even at that low rate, you still end up in the red, meaning you owe money rather than having money.  If you have an extra $54 laying around, I’ll get my Christmas wish list to you.

Sow how do we keep Christmas spending in the black?

  1. Write down everyone that you are going to buy a gift for this year.  Even the little ones.  Just like Santa – make a list and check it twice.  My wife and I only have two kids and one sister each.  But when you add everyone else in, I came up with 24 people we will be buying gifts for.  See, you can’t forget the teachers, the extended family gift games, and the work white elephant gifts.
  2. Note how much you want to spend on each person.  Sometimes that will be more than others.  We are at the point now, with a tween, that gifts start getting more and more expensive just because that’s what they are in to.  Those will start adding up, but don’t forget the little ones.  One year, in a white elephant exchange, one of my coworkers got two dollar store frames, each with a cheesy picture of me in them.  I know I spent less than $10 on that one and it was a really good laugh.  When I count up how many of those little ones we will end up buying at our house, it could easily be over $100 of our Christmas budget this year.  The little ones are the ones that will sneak up and get you.
  3. Put the Christmas list away and consider your bank account.  calculate budgetHow much do you have to spend on Christmas this year?  If you want to stay in the black, how much can go to Christmas without missing utility bills, loan payments, and other expenses?  Regardless of the amounts in your budget, be honest about what you spend so that you aren’t surprised should you end up in the red (and not because you are Santa).
  4. Bring the Christmas list back out and balance.  Now that you know how much you have to spend, where do you need to adjust your Christmas spending per person?  Are you finding a wad of extra cash in your budget that you could be spending on Christmas?  If so, make sure it really is there and available rather than being spent in places you didn’t expect (or know but won’t admit to).
  5. Go shopping together (or alone).  If you are going to struggle sticking to your shopping list and budget, take along a trusty sidekick.  Let them know right up front that they are there to help you stick to the budget.  They don’t even have to know the exact numbers, just to ask every time you pick something up, “Does that fit your budget?”.  But if your trusty sidekick is the one you can trust to spend all of your money, then go alone.  Don’t let them tempt you into spending more than the plan, or you’ll be seeing red….. in more ways than one.

And there you have it.  Five steps to a black Christmas.  OK, OK.  A Christmas in the black.  But that just doesn’t quite have the same ring to it.

Not sure you have someone in your life you can trust with helping you in your budget?  The counselors at the Center for Financial Resources can help.  While they are used to working with people in real crisis, they also love to help people plan and maintain a budget to prevent crisis.  You can schedule an appointment online or call us at 605-330-2700.

Ask nice enough, and the counselor might even send you on your way with a hearty “ho, ho, ho”.


written by Breck Miller
images courtesy freedigitalphotos.net

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