Taking the Humbug out of Christmas Finances

In 1843, Charles Dickens wrote his most beloved seasonal novel, A Christmas Carol. It's a tale full of contrasting characters from Ebenezer Scrooge, the grouchy old miser who cared for no-one except himself and lived only to fill his coffers with more money, to the destitute family of his clerk Bob Cratchit, who worked long hours under inhumane conditions to provide for his family. But it is also a story whose central theme is about redemption and the meaning of Christmas. The turning point of this narrative comes when the “spirit” of his former business partner, Jacob Marley, visits Scrooge on Christmas Eve. He informs Scrooge that his only hope of deliverance from an afterlife of wishing to no avail that he could help his fellow human beings is by understanding three ghosts that will visit him in a dream—the Ghost of Christmas Past, the Ghost of Christmas Present, and the Ghost of Christmas Yet to Come.

These three phantom characters not only have something to say about the poverty, want and ignorance of 19th‑century society that Dickens was trying to portray, but they also have a message for us as we enter the festive season of 2006. I don't believe Charles Dickens would mind my changing the portrayal of his ghostlike characters concerned with social agendas into financial spirits that haunt our current Christmas spending.

In fact, I think he would probably agree, because in real life he understood and experienced extreme poverty when, as a young man, he was forced to work in a shoe‑blacking warehouse to support the family while his father was in debtors' prison.

Christmas past

The financial ghost of Christmas past appears in the mailboxes of the majority of us a few weeks after all the excitement and joy of the Christmas season has gone. It comes in plain envelopes containing unexciting but exorbitant creditcard statements. Unfortunately, this financial spirit often hangs around well into the year, and sometimes it even joins a second companion as they overlap into the following year's Christmas splurge.

To top it off, this financial ghost of Christmas past aggravates an already encumbered monetary situation by continuing to add to the family's financial burden with high interest rates and other charges. One out of five households will continue to live with the ghoulish reminder of their holiday financial indulgence many months into the new year.

Christmas present

One of the problems with the financial ghost of Christmas present is that it demands we give and give and give again. Often this includes people to whom we would not normally give anything, such as fellow employees with whom we seldom socialise and to neighbours and acquaintances whom we barely know.

Today's style of gift giving is a relatively new practice. For centuries in most countries, individuals exchanged gifts on New Year's Day and left Christmas a noncommercial religious holiday. They observed December 25 by providing food for the impoverished and disadvantaged, and in some instances a day for giving special gifts to pastors and missionaries.

To appease the financial ghost of Christmas present, the best thing one can do is to stay within an established Christmas budget. This may necessitate that you become creative and use a little ingenuity. One idea is to make up gift certificates that can be redeemed by family and friends during the next 12 months. Examples might be fresh produce from your garden or a homemade meal. Another idea might be to give coupons to a couple with a young family, good for several nights of babysitting.

Another way to appease this financial ghost of Christmas present is to think like Santa—make a list, check it twice, and stick to it. Instead of getting another gift for your youngster's stocking or an extra gadget for your spouse, cease the commercialism and enjoy the spirit of Christmas: read a favourite Yuletide story to your children, or take a trip around your neighbourhood and receive pleasure from the Christmas lights and decorations.

Trust that you have purchased the best gifts for each member of your family. If you have to add one more gift, let it be a personal note to a friend, fellow employee, boss or loved one telling that person how much you appreciate having them in your life.

Christmas yet to come

Although you may not like being somewhat similar to Mr Scrooge when it comes to Christmas shopping, it will be the best present you can give to yourself and your family. Listed below are some tips from the financial ghost of Christmas yet to come to assist you in being debt free next December.

1. Develop a budget.

Sit down with your spouse and figure out what your family can afford to pay for gifts and other Christmas items without accumulating any credit‑card debt. To be able to accomplish this, in January you may need to start a Christmas savings account. Make it an item in your weekly budget and regularly contribute a fixed amount of money. Your goal should be to purchase all your Christmas gifts, tree ornaments, a nice Christmas dinner, and other seasonal items out of the money you have set aside in this account. Creating this item in your budget is the single most important step an individual or a family can do to control their holiday spending.

2. Make a list.

At this family conference, write down every person you want to include on your Christmas list. Then put a pad and pen on the side of the refrigerator and add other names as they come to mind, so no-one is forgotten. For family members, relatives and special friends, you will purchase a gift, but for some neighbours and acquaintances, the best gift would be a simple card with a family picture or a plateful of homemade biscuits.

3. Have a limit.

You will need to keep two limits in perspective. The first is how much you should spend on each individual, particularly each member of your family. The second is how many presents you will purchase for each individual, especially your children or grandchildren. Some have taken the biblical example of the Magi, who brought only three gifts to Jesus, as the limit of number of gifts they should give to each child in their home.

4. Develop a strategy.

Like the real estate slogan that says, “Location, location, location,” you need to be a year‑round Christmas planner with the slogan, “Listen, listen, listen.” As your husband, children or friends casually make comments such as, “I wish I had this tool,” or “That's exactly what I need to complete my kitchen set,” or “If I could only upgrade my computer,” write down what it is they desire and use this list, particularly as these items may come up on sale. Purchasing your next season's gifts throughout the year puts you ahead of the traditional last‑minute rush and lets your loved ones know you are thinking of them all year, not only at Christmas time.

Another strategy is to have 80 per cent of your Christmas shopping completed by the end of November. One way to accomplish this is after you have enjoyed the Melbourne Cup and a wonderful day with your family and friends, relax that evening in your living room with the local newspaper. Take out that bulky sales section and begin comparing the items on sale with the individuals on your special Christmas list.

No more “Bah, humbug!”

As you struggle through this festive season and then determine to plan better for next year's Christmas spending and giving, may your money management no longer be “Bah, humbug!” but in the famous prayer of Tiny Tim, may yours be “God bless us every one!”

Reprinted with permission fromSigns of the Times, US