Plan Ahead for Holiday Spending

    Moderation in all things is what the Greek philosophers counseled, but they
couldn't have been talking about Christmas. The yuletide season, after all, is a
time for excess - when diets and budgets and just about every other form of
self-restraint go out the window.

    Swipe that little plastic card once too often, and you could end up in
serious debt by the time January rolls around.

    "Christmas is a time when people tend to max out on their credit card," says
Daniel Barrera of Consumer Credit Counseling of San Diego and Imperial counties.
"Three years later, they're still paying on that account. By then, they don't
even remember what they bought."

    Dollars and sense are often in conflict - particularly during the holidays.

    "It's supposed to be a storybook time - the family is supposed to be perfect
and wonderful - only life isn't a storybook," says Ellen Margolis, a
psychologist who frequently counsels her clients on money issues. "Often, the
people who feel [the] worst about their lives end up spending more because
they can't meet the ideal."

    Divorced parents may compete for the affections of their children by buying
expensive presents. But several hundred dollars later, "your kid is still
unhappy at school," Margolis says.

    Sometimes, understanding the drive to spend helps people put on the brakes.
Advance planning and savvy shopping also keep the urge to splurge in check.

    Here are some ways to practice safe spending:

    - Make a budget and stick to it. You need to create a detailed budget -
preferably in January or February, Barrera says. Take a hard look at last year's
expenditures, and plan your party, gift-giving and decorating costs accordingly.

   - Make a list of appropriate gifts and, in each case, suitable alternatives.
(If you can't find a blue cruise wear shirt for Tommy, a pair of navy men's
shorts won't bust your budget, either.)

   - Once you've set aside a Christmas nest egg, put the money in an
interest-bearing savings account. You'll draw that money out ever-so-gradually
during the year. In lieu of running up credit card interest, use cash, check
or an ATM debit card to pay for your monthly purchases.

    - Shop around. If you give yourself a year to shop, you can find the time to
compare prices and merchandise - and not end up with the highest price and the
worst value because you've left everything for the last minute. Make a list and
buy an item when it's on special.

    - Buy one present for him and her. For the couples on her list, Mary Wisner,
a technical writer in Lake Wylie, S.C., assembles gift packages that both people
will enjoy. Last year's inspiration was a picnic basket for two. She bought the
basket at a yard sale, filled it with a silver-plated coffeepot, two china cups
and saucers she discovered at a flea market, added some homemade chocolate chip
cookies and coffees that she flavored herself and two linen napkins. The $ 13
cost fell well within her budget.

    - Make a family pact to split the spending chores. That time-worn ritual of
buying a present for every niece, nephew and half-stepbrother on your list is a
budget-buster and a time drain.

   - To shorten the gift-giving time, some extended families now hold a kind of
pre-Christmas lottery. Around September, you get to draw straws, pick a name out
of a hat or roll the dice to find out which relative to add to your shopping
list. Obviously, this isn't a unilateral decision, and you'll need to get your
own family to buy into this plan.

    - Begin your Christmas shopping the day after Christmas. That's when gift
wrap, greeting cards and luxury tinned foods go on sale. Reserve a corner of the
closet or attic for next year's Christmas supplies.

    - Look for golden oldies. Aside from pricey antiques, have you ever thought
of buying used gifts? It's all a matter of definition, says Wisner, who reckons
that "once someone tries something on in a department store, it's 'used,' and
once you wash a new item of clothing it's also used."

    As anyone who frequents thrift shops and garage sales can tell you, it's
amazing what people choose to throw away. Wisner recently bought a long-sleeve
cruise wear shirt for $ 3 "from a guy who had worn it once on a cruise but
didn't feel that it was 'him' once he got home."

    - It's the thought that counts - but do think twice. A week's worth of
dog-walking, a set of baby-sitting IOUs, a basket of homemade pies and jellies
were always much-appreciated gifts - and still are. But there's a caveat here:
The personal touch is not for everyone - and we mean the giver as well as the
receiver.

If you're already working a 70-hour week and wearing yourself to a frazzle,
read and reread the adage that time is money. Don't judge yourself too harshly
if you don't have the time or the inclination to create a clever handmade gift
for everyone on your list. Sometimes, spending money is cheaper in the long run
than saving it.

    On the other hand, do encourage your children to spend their time and spare
their allowance when preparing for the Christmas season. They can walk the dogs
and do the baby-sitting.

    - Repair the damage of Christmases past. If you're still paying the bills
from previous years' merrymaking, here is the perfect gift to give yourself: a
leg up on your financial future. If you haven't already done so, buy a copy of
one of the leading personal finance software packages. Either Intuit's Quicken
or MS Money will work - and each program has its fans.

    The next time you write a check or pay a credit card charge, add the
information to your computer database, and you've taken an important step toward
fiscal fitness. You can set up a category for Christmas spending, and the
program will automatically track your charges throughout the year.

 Consider consolidating your credit card charges and paying them off on a
single card. And if you're still confused about living the good life on a
budget, treat yourself to a copy of "The Tightwad Gazette: Promoting Thrift as a
Viable Alternative Lifestyle," by Amy Dacyczyn.

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