Turning Attention to Christmas Bills

When I was a kid I remember being so depressed the day after Christmas, knowing Santa would not make a return trip for some 364 days. As a grown up, I developed new reasons to become depressed after Christmas: bills!

Fortunately, in the last couple years we have managed to get a handle on our Christmas spending.  But it hasn’t always been that way.  Early in our marriage we bought presents for everyone under the sun (and to make matters worse, I married into a large, extended family).  I guess I was suffering from “new son-in-law” syndrome. The symptoms include overspending around the holidays in an effort to impress your new half of the family.

The years of overspending at Christmas were not a total loss, as we did learn some debt reduction tactics out of the exercise, and it did manage to cure our mega-consumer habits. So if you find yourself preparing to dig out from holiday bills, I offer the following tips I’ve collected along the way.

Take an inventory of the damage.  This first step is by far the most painful. To devise a game plan for digging out of holiday debt you must first figure out how deep you are buried. I suggest firing up a spreadsheet on the computer, or even dragging out a legal pad and pen, and listing each of your credit cards.  Update each card’s balance with current information from their website or voice response unit (you can wait on statements to roll in, but if you are already anxious I recommend getting a jump start).

Use extra savings to pay down debt.  If you went a few hundred dollars over budget, and have that money in savings, I recommend transferring some money around to pay off the debt. Only take this route if your savings balance is high enough to pay off the debt and leave some for emergencies.  The last thing you want to do is clear out all of your savings, because as soon as you make the payment you will encounter an emergency–guaranteed.

Rework your debt snowball plan.  If you have racked up more debt than you can pay off in one swoop then you will have to come up with a debt snowball plan. Line the balances up smallest to largest and pay minimums on all but the smallest.  Throw every single bit of “found” money in your budget at the smallest debt until it is gone.  Yes, that includes the money your great-aunt slipped into your Christmas card.

If you racked up quite a bit of high-interest debt, such as credit card or store card debt, consider a low-interest consolidation loan to pay off the high-interest debt and then snowball the loan.  If you go this route, be sure to close out the store card accounts and cut up the credit cards or you risk going right back into debt.

Do not allow history to repeat itself.  When your debt snowball has completely melted turn your attention to saving some Christmas cash to spend next year. Set up a dedicated savings account and funnel a little money there each paycheck throughout the year. By November you will have a few hundred dollars to spend on Christmas, saving you from post-holiday debt blues.


  1. You know, probably the weakest link in your list of suggestions is the last one. It really doesn’t do any good to get out of debt, or pay off your bills (Christmas or otherwise) if you just go right back into debt all over again.

    I won’t “break” those habits … ever. Seems the harder I try to “break” a habit, the more entrenched it becomes. The key for me was to replace them with good and healthy habits.

  2. Excellent tips. If you are realy good at planning, you can take advantage of the after Christmas saving to purchase gift for your children next year. We usually save quite a bit, but this year the discounts are even deeper.

  3. Feeling the pain of Christmas spending, too.
    Ended up bying last-minute gifts for a few people out of a slight feeling of guilt …
    Look out New Years!

  4. To go in debt at christmas time to me is just ridicolous! (sp). I take $50 out of my check every two weeks for six months and that is all I will spend on christmas. I don’t understand why people would go in debt for presents. Why not make some homemade cookies, bread, etc.,. For the past few years after buying all my christmas presents I have about $100 left in my christmas fund so I put it in my emergency fund.

  5. Like all parts of my life, Christmas is managed on an Excel spreadsheet. I have a list of those I shop for year after year. In the column beside each name I enter gift suggestions, and in the third column I enter the gift actually purchased. After Christmas I take all the suggestions which were not used and move them to the list for the next Christmas. For kids the ideas may not be viable a year later, but for many adults it’s nice to have a few suggestions already in mind. Having the lists of what I bought in prior years ensures I never repeat a gift. By having next year’s list ready to go days after this Christmas there’s no excuse to delay the shopping. I aim to have all my shopping done by Halloween at the latest. I hate shopping and facing holiday crowds at the mall is equivalent to a root canal. By spreading the purchases out from Dec 26th to the end of October there’s no reason it can’t easily be accomodated in the regular budget.