How To Create a Holiday Budget

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How to create a holiday budget By Andrew Housser It's holiday season, and despite the fact that snow has begun to fall and warm weather is a distant memory in some parts of the country, many people are ill prepared for the expenses that can accompany the season's festive celebrations. Before you head to the shopping malls or online stores, take a moment to make a budget for the holidays. 1) Estimate your baseline. From mid-November, six weeks remain to scrimp and save for the holidays. If you are a planner, you might have a savings account dedicated to holiday savings that you started last year. If you are like most people, however, you have not done that. The average holiday expenditure in 2011 will be $704 per person, according to the National Retail Federation. How much will you have available? Be sure you can give gifts without vaporizing your emergency fund or going into credit card debt. 2) Make a list of gift recipients. List the gifts you will give this year. Remember your relatives and close friends, as well as gifts you customarily give to teachers, doctors, neighbors or others close to your family. Also include year-end tips for newspaper carriers, babysitters, housecleaners, hairdressers and other service providers. If you frequently make charitable donations at the end of the year, include those, too. You might be surprised how many people (and organizations) are on your list! 3) Add up gift spending. Next, assign a dollar amount to each recipient. Tip: Many frugal holiday gift-givers simplify their budget by assigning a dollar amount, rather than a certain gift, to each recipient. Then they challenge themselves to shop for bargains to give the nicest gift that fits within their budget. 4) Tally other holiday costs. If you purchase holiday cards and postage, holiday portraits, decorations, food and drink, special outfits, or need extra child

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