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How to make it a debt-free Christmas.

IT'S that time of the year again. From Christmas bells and Christmas trees to the seven days that Kwanzaa brings, the holidays are a time of good fun, good food, and nonstop shopping. But many months after the holidays are gone, the debts from our spending sprees still remain.

But this year can be, and will be, different.

Robert E. Frank author of No-Debt Living, has said, "The average American adult with a credit card racks up about $1,000 in debt during the Christmas season. Proportionately, a two-parent family charges about $2,000. But with a little planning and determination, you can avoid holiday debt and reclaim the true spirit of the season."

Be Realistic. Many people think with their hearts instead of their minds. "Rather than making decisions on an emotional level, make them on a practical level, keeping in mind the constraints of your budget," says Monica Harris, founder of "Keep Empowering Yourself Successfully," a bilingual educational program, which includes workbooks, DVDs and instructional seminars on finance and wealth empowerment. "If the gift is from your heart, it doesn't have to break your bank."

Start Early. The best time to start shopping for the holidays is right at the end of the current holiday season, according to some finance experts.

"Early shopping gives you the chance to make the most of sales and seasonal pricing trends," says Chris Farrell, author of Right on the Money and one who advocates periodic buying. "Spreading out your spending is also a good way to avoid using credit cards. The reason most people use credit cards at Christmas is that they are going out and buying a lot of things at once."

Budget. Starting months before the holidays, begin to set aside a certain amount each week including loose change. "If you're in the habit of going out for lunch every day at work now is the time to consider bringing in leftovers once a week and sock away that $6 to $8," says Gary Foreman, publisher of The Dollar Stretcher. According to many financial experts, this will help you to use cash, rather than credit. "Remember that anything you put on credit cards and finance at those convenient monthly rates will cost you more [in the long run]," says Foreman.

Always Shop With a List. Don't attempt to do any shopping without a list during the holiday season. "Take out a pencil and paper and, down the left-hand column, list all the people to whom you will be sending gifts or cards and the estimated cost for each item you plan to purchase," said Frank. "If your total costs exceed your budget, review your list, delete or change items until your resources and costs match."

Comparison Shop. "The deals are unparalleled as retailers compete for your dollar," says Tameka Johnson, a finance student who always starts her Christmas shopping early. "You can really pick and choose because everyone is slashing prices in order to get your business."

Use the Internet. Not only can you save time by shopping online, you can also save a few extra dollars (or more) on each purchase. "Some Internet-only deals are well worth researching," says Mel Kendall McCray, a 20-year veteran in the finance field and a member of the Million Dollar Round Table Association. "You can shop, browse, purchase and even return, all with the click of a button. That eases your mind and your worries."

Unlike any other season of the year, the Christmas holidays produce an emotional tug at the heart of most consumers, says Harris. "Families have to stay mindful of the true reason for the season. People have to recognize that Christmas is just one day. If you start there, I think it helps to put things into their proper perspective," she advises her clients. "Develop a plan on how you plan to spend this season and don't go beyond that. Stay in control."
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Title Annotation:Money Talks
Date:Nov 1, 2004
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