Paying for Christmas 4

My final tip in this series is probably too late for Christmas this year, but, if you begin in January, just think how less financially traumatic Christmas 2006 will be!

Write out a list of everyone you need to buy Christmas gifts for. Next to each name, write down the amount you expect to spend on that person. Add up the total amount that you expect to spend on Christmas gifts this year and add to that anything you expect to spend on decorations, cards, a tree, etc. Divide the total by the number of months you have left before Christmas (obviously the earlier in the year you do this, the smaller the monthly amount you will need to save). Open a separate high-interest, easy access savings account and, every month, transfer this monthly amount across. By doing this, you always have money to take advantage of any bargains you come across and you will be paying for Christmas in advance, in cash, rather than using your credit card and paying it off all the next year. Don't forget to do the same thing with birthdays.