Making prudent money decisions this Christmas

MANILA, Philippines—’Tis the season to give and pay back, and the sound of cash registers ringing loudly in malls is temptation enough to shop till you drop. But with money getting tighter by the day and more people not finding jobs, families are now more careful about how they spend their income and windfalls. For parents and couples, the holidays have become a source of family conflict and stress—what with so many people to give gifts to.

Of course, you don’t want to be in that “Bah, humbug!” spirit but the trick is: you won’t be if you care enough to put your money where it should be and where it should not be (accumulating heavy credit card bills, for starters, and which usually stretch long after the merry season has ended).

Money huddle

Scott and Bethany Palmer, authors of “First Comes Love, Then Comes Money: A Couple’s Guide to Financial Communication,” say the holidays are a minefield of difficult money decisions. They say people usually ask themselves these questions: How do we stick to a budget and still give meaningful gifts? Do we really need to buy a gift for this relative? Where are we going to get the money to pay for all of this stuff?

The Palmers suggest that couples constantly communicate with each other as regards their finances, starting with a “money huddle” to check in on their expectations and to create a spending plan that won’t leave them broke. Here are their no-nonsense tips:

“Make your Christmas gift list. Work together to figure out who you need to buy Christmas presents for, the Palmers recommend. “Consider one gift for your sibling’s whole family instead of a gift for each person…give handmade gifts instead.”

Set your spending limits. “Before you set foot in a store or do any online shopping, know what and how much you can spend on your gifts. Look at your budget and be realistic. Be conservative so you have a little wiggle room if you need it,” they suggest.

Avoid last-minute shopping. Shop early, say the Palmers, to give yourselves time to find the best deals on holiday gifts and make smart purchases. This move also saves you costly and time-consuming return trips to the store, supermarket or mall.

“Check in with each other. “Plan on weekly money huddles to make sure you’re staying on track. Write down what you’ve spent, check people off your list as you buy their gifts, and keep communicating,” the authors suggest.

Be aware of your “money personalities.” The authors refer to the strengths and challenges of every person in regard to his views and attitudes toward spending. They say spenders are in the zone while savers are freaking out. And so they recommend keeping your money personalities in mind as you make your plans.

“Be prepared to compromise to keep the holiday season merry and bright for you. It brings with it beloved traditions, joyous memories, and happy moments with friends and family—but it doesn’t have to bring financial stress,” advise the Palmers.