The Amateur Financier

Well, the holidays are over (or are well underway, at least; I realize that it’s only the fourth day of Christmas, for those of you who celebrate all twelve days, to say nothing of the other holidays that occur during this time of year). Hopefully, you’ve had a good holiday, with plenty of friends, family, and fun times. Now would seem to be the time to kick back, relax, and wait for the New Year to come.

But alas, that’s not always possible. There’s plenty that should be done before the year ends, or near the start of the year next year, at the latest. I’ve covered quite a few items on Monday (because I couldn’t let you go any longer before thinking about what you needed to do), but there’s an elephant in the room we still need to discuss: paying for those holiday presents.

Yup, Christmas Presents just like this

If you are like a great number of people in our modern society, there’s a decent chance that you went into debt (or added more debt to what you already had) buying presents for everyone (I know that I did). It happens, and I’m no position to scold you for it; now, though, is the time to plan how to deal with this added debt. We should start by:

1. Accessing the Damage: You need to know where you stand before you can figure out how to deal with it. Luckily, it’s easier than ever to find out where your finances stand nowadays: every credit card company allows you to check your balance online, as well as making payments. You probably kept track of how much you spent, of course, but it’s a good idea to go back over your statement to ensure that you are only being charged for spending you actually did, as well as making sure you know the total of what you owe.

2. Making a Plan: When you know what you owe, it’s time to figure how to eliminate it. There are a few different issues you will need to consider, from where to get the extra money to pay down the added debt (do you cut down your spending, or perhaps try to earn some money through a side job?) to which debt to tackle first. (There’s quite a bit of disagreement on the best order to handle debts; I tend to support trying to deal with the highest interest debt first, but paying down debt is good, regardless of the exact order you follow.)

3. Stick to that Plan: Once you know how you’re going to pay down your Christmas Present debt (or any debt, for that matter), it’s simply a matter of sticking to your plan. Alright, it’s not really that ‘simple’; if it were, there’d be a lot less trouble with debt in the world today. If you are going to stick with a plan, you need to make sure to reward yourself when you meet landmarks along your road to the ultimate goal of finishing off your debt. Try to find things that will bring you joy, but won’t cost much money; a picnic in the park or a (frugal) night out as you clear out your holiday debt will make it that much easier to remain motivated as you keep paying things down.

4. Plan for Next Year: Let’s be honest, there are some expenses, like car repairs or medical expenses, that we can’t see coming. Holiday expenses are NOT in that category, though; while you might not know exactly how much you will spend next year, you can probably come up with a ball-park figure about what you will need to keep everyone on your gift list happy (as well as providing food, decorations, and all the other holiday accouterments). Rather than charging all those expenses, why not put money aside throughout the year so you can pay for the holidays with your own cash (and enjoy the interest you accrue along the way, rather than pay interest to the credit card company)? By breaking the expected expense up and putting aside a smaller portion monthly or weekly (similar to an emergency fund), you can ensure that there will be plenty of holiday cheer, or at least, fewer holiday credit card bills.

Alright, that should be enough to get started on dealing with your holiday related credit card debt. Hopefully, next year you can have an even better holiday with less holiday debt as a result. Good luck, and enjoy the holiday time!

Merry Christmas to All, in this wonderful year of 2011!

I’ll make this short and sweet, as I’m sure I’m far from the only one who has assorted Christmas fun and duties to attend to today.  To everyone who is celebrating the holiday today, I hope you have a wonderful day, that you get to spend it with friends, family, and others whom you care about deeply.  It is a very special day, after all, which even if you are not the most religious person around (and I’ll admit, I’m turning into a bit of a ‘Christmas and Easter’ member of my church), has a unique place in most of our lives.  Remember those feelings as you go through the day, and let them carry you through all next year, as well.

For the non-Christmas celebrating crowd, as always, I hope you have a good day, and forgive us Christians for shutting down just about everything today as we celebrate.  Tomorrow, most things (with the exceptions of the Postal Service and most banks) should be back in full running order, and you can get back to your normal lives (although, you might want to avoid the malls; there’s likely to be a rush of gift returns and people taking advantage of after-Christmas sales for the next few days).  For today, have a nice Sunday, spend some time with your family, and take advantage of the fact that most everywhere you go that happens to be open (in the United States, at least) should be nearly empty.

Once again, Merry Christmas to All, and to All, a Good Sunday!

Once upon a time (about two years ago), I shared some tips for the last minute shopper to get their holiday gift giving covered.  They were, I’m pleased to say, a huge hit, helping dozens, if not hundreds or even thousands, of last-minute shoppers to keep their gift exchange partners happy and help to fill up the space beneath the Christmas tree.  (Or barring that possibility, helping them to have a serious head injury so as to allow them to dodge the whole Christmas season altogether.)

But it’s been so long since I put that up, there’s sure to have been some updates to how the smart consumer covers their last-minute gift-giving (besides, of course, buying presents early enough to avoid having to do last minute gift-giving in the first place; that’s just crazy talk).  Let’s take a look at some other possibilities for the gift-giver who has waited until the last possible minute:

1. Money: Always a classic; there’s a fair chance you have some in your wallet at this very moment.  (Unless, of course, you’re just getting back from some other Christmas shopping).  It’s inexpensive, highly flexible, and generally appreciated by nearly everyone.  Now, it does tend to send a bit of a strong message (namely, “I did not have any idea of what to get you for a gift, so here’s some cash”), but that’s nothing that can’t be fixed with a decent card.  If you want something more personal, you can try…

Yes, I like to use this Money Gift picture; it's very fitting for this time of year.

2. Gift Cards: The standard for anyone who wants to give something a bit more personalized than cash, but still is at a loss about what to give to their chosen recipient (not always the gift-giver’s fault, of course; if I had a dollar for everyone in my family who has been tight-lipped about possible gift ideas, I’d be able to buy quite a few more gifts for everyone).  Of course, being more personalized can be troublesome; it’s possible to buy a gift card to somewhere your recipient doesn’t ever shop or want to shop.  It’s also possible to end up with a gift card that’s pretty well worthless, as anyone still holding Circuit City or Borders gift cards can tell you.

3. A Time Machine: Alright, it’s a little early to pick up one of these.  (Some spoil-sports will argue that it is impossible; if time machines exist, they say, we would have seen people who were from the future coming back to our time.   I say they’re just trying to spoil our fun; haven’t they heard of cloaking devices or police boxes?)  But still, it would make a wicked present, or you could use it to get something for your recipient from their past.  Or use it to become the king of a past time period; either method is fine, really.

4. Coal: Have someone naughty on your list?  Pull a Santa and give them some coal the next time they start acting up.  Besides helping to reinforce some sense of appropriate punishment, you’ll also be able to help out the coal industry.  Why should the fat man in red have all the fun, after all?  Just be aware that not everyone will be amused, and that coal can be a bit on the expensive side.

5. A Thoughtful, Insightful Gift That Shows a Deep Understanding of the Recipient and Adequate Realization of What They Both Want and Need, An Even Deeper Grasp of Their Psyche Than They, Themselves, Possess, a Gift That Is Sure to Leave a Deep Impression on Them Years, Even Decades, Later: You don’t have time for that kind of thing; let’s get back to that ‘money’ idea.

Alright, that’s plenty of gift ideas for now.  Here’s hoping everyone has a good Christmas, and has already finished their shopping (I know I have no desire to go to stores now, with all the gift shoppers in a near frenzy).  Here’s also hoping you came up with lots of thoughtful gift ideas, in spite of my best efforts to play with your minds!

Ah, Holiday time is upon us. with its songs of good will and cheer, optimistic fellows, and of course, the opportunity to smooch cute coworkers under hanging plants with fewer consequences than normal. (Although, you do need to make sure that they WANT to be smooched…) It’s a wonderful, magical time of year, filled with parties, gatherings, and shindigs of all kinds.

Of course, when you’re throwing one of those shindigs rather than attending them, it can get a bit expensive pretty quick. It can also be a overwhelming, particularly if you don’t plan things out first. For some help on how to plan a fun (but frugal!) holiday party, read on:

1. Stick with Electronic Invitations: Let’s start before we even get to the party, with the invitations. While it might seem to be fancier to send out paper invitations to all your friends and family, doing that gets expensive quick, between the invitations themselves and the postage to get them to their goals. With nearly everyone online, it’s easier than ever to send out electronic invitations to your guests and save yourself some time, money, and hassle.

2. Make it a Potluck: This might not work in every situation; your family or friends might give you odd looks if you insist that everyone bring their own food. But for many situations, it’s not only acceptable but could even be appreciated, allowing your guests to show off their own cooking skills and share some of their favorite recipes. You should, of course, provide enough food on your own to keep your guests from starving if not everyone (or nobody) else brings anything, but you don’t need to provide your guests with a twelve course meal to be a good host. On that note…

A festive Gingerbread House is, of course, always appreciated

3. Cook Relatively Inexpensive Food: Even with a potluck meal, you, as the host of the party, will have to make quite a bit of food. There’s simply no way to be sure that your guests will provide enough for everyone you is attending, and even if they do, you’ll still appear cheap (not frugal, cheap) if you don’t provide SOME food. That’s not to say that you need to spend a small fortune on the meal; it’s possible to make a decent meal inexpensively. Look up some inexpensive and easy to prepare food items, shop at a bulk food store for your ingredients, and don’t try to do more than you can, preparation-wise, and there will be plenty of food by the time your first guests arrive. While we’re talking about the menu…

4. Stick with Appetizers or Desserts: It can be hard to provide a full meal to everyone, particularly given the size of the typical holiday meal. Rather than try to feed everyone a massive feast, you can stick to a relatively small course, like appetizers. In my family, it’s traditional for us to meet the extended family after our individual family meals to exchange desserts and spend a few hours together talking and laughing. Everyone gets a holiday party together, without anyone having to cook for dozens of people. (Although, given how my family is, everyone ends up making enough for the rest of the family anyway…)

5. Use Real Plates and Utensils (Carefully): This method allows you to not only save money on the large amounts of paper plates and utensils you’d go through at a holiday party, but also to make the whole thing look a little bit classier. You’ll add to your time spent cleaning up afterwards, but not by that much, and the benefits should outweigh the costs. That said, if there are going to be small children around (your own or your guests’), you will probably be better off with plates and bowls that won’t break if dropped. It might be worth it to spend a bit more money now to prevent such a situation than spending more money later to replace your plates. (To say nothing of not having to worry about the children cutting themselves.)

6. Keep the Alcohol to a Minimum: You’ll save money, help ensure your friends and relatives have a safe drive home, and help to avoid any unfortunate ‘incidents’ spurred on by the alcohol. Enough said. (Alright, here’s a bit more: as with the potluck suggestion, the norms in your family or circle of friends might make a dry party seem cheap. If that’s the case, consider providing some drinks, but stick with one or two ‘signature’ drinks (eggnog being a big one for the season, of course), rather than trying to keep a full bar stocked and ready. It’ll be more festive, while still allowing those who want to indulge the chance to do so.)

There you have it, a few ways to have a festive holiday party while not breaking the bank. Have a Merry Christmas, Happy Chanukah, Festive Kwanza, and/or Cheerful Solstice!