Use these three expert tips so the 35 days between Thanksgiving and New Year's won't torpedo your finances.

In the next two months, the pressure is on like no other time of year -- to entertain, to purchase gifts, to decorate, to contribute to office or community festivities and to travel to Grandma's house (via sleigh or not).

Just about every financial advisor agrees, it doesn’t matter how much people are told not to go out and overspend during the holidays, everyone does. In fact, a November 2008 "Consumer Reports" survey showed that about half of the consumers who had set a holiday budget exceeded it.

This is a bad habit to fall into. We need to learn to live within our means. This blog post (and a few great websites) will give you ideas to help keep your holiday spending under control.

1. USE COOL WEB TOOLS. There are numerous online calculators and financial tools that will help to estimate what you can afford to spend at your income level. This number should cover everything -- travel, food, gifts and other costs.

Remember, it's just an estimate. It’s a good idea that if the number is really too big for you to pay off by February, adjust downward. Sticking to that deadline allows a little breathing room without the worry of paying too much in interest. If you are already in debt, then trim your budget substantially to avoid further spiraling out of control.

“get on your computer and plan to shop smarter”

After you've set your bottom-line figure, go to about.com and type in "holiday gift spending budget worksheet" and "holiday spending worksheet." Use the gift worksheet to list each recipient and a spending limit. Keep the list with you when you shop. If you go over budget on one person, cut back on another.

The holiday spending worksheet will help calculate all other holiday-related expenses. Be sure to include things like hostess gifts, year-end tips for hairdressers and other service providers, seasonal flowers, and gas and tolls for out-of-town trips. Then add a bit more to the total for a "last-minute" fund to cover unanticipated expenses. Little things can add up quickly.

2. PAY THE RIGHT WAY. Many financial advisers suggest using only cash or checks to buy presents so you won't spend more than you have. But for many people, that's unrealistic, especially if you'll make purchases online.

By using a credit card, you'll be able to return items more easily, if necessary, and you'll get more merchandise protection. Plus, you can log into your account and track purchases online during the season to make sure you stay on budget. Just be sure to use your credit card with the lowest interest rate.

3. START SAVING NOW FOR NEXT YEAR. Many banks and credit unions offer "Christmas club" savings accounts. The interest isn’t huge, but you can automatically deposit a small amount each month. You usually can't withdraw it without incurring fees until a date near the holidays, when the bank sends you a check. It's painless because you've set money aside slowly over the year in small increments that you don’t even miss.

For the short-term, it's not too late to start saving for this season's post-holiday bills. A goal for this year would be to, discipline yourself to put away $50 or $100 a week in a safe place so you will have a jump on your credit card bill when it comes due early next year.
 

Happy Holidays!!

from www.usaweekend.com