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Where Did It All Go?by Chris AndersonBLOOMINGTON, IL -- When it comes to living within your holiday means, the chubby guy dressed in red turns out to be a pretty good role model. Remember the song about Santa Claus coming to town? It actually provides at least one sound financial planning tip: Santa made a list and checked it twice. Twin City financial advisers suggest a similar tactic for keeping the reins on holiday spending. Make a Christmas list, devise a spending plan and stick to it. "Every day could be Christmas. We should be nice to ourselves all year round," said Jeff Telling, branch manager of Family Credit Counseling Service in Bloomington. "But it's plastic season. Living within our means is more difficult at Christmas." Family Credit Counseling Service is a nonprofit, nondenominational, Christian-based agency. Telling said the Christian message is to give to others. He noted that the tradition of gift giving originated with the Wise Men bringing priceless items to baby Jesus. "But giving has to be for the right reasons. What's your motivation? Who controls your spending? If you're a Christian, it should be the Lord," said Telling, who opened the Bloomington branch at 2703 McGraw Drive five months ago. The company was founded eight years ago in Rockford, the company's headquarters. Telling, along with financial specialists Carol Burroughs and Delfina Baker, said planning for Christmas expenditures should be part of an overall personal/family financial plan. "Most people don't plan for Christmas. That's usually how they approach financial planning in general. They just hope things work out," said Burroughs, owner of Normal's Forward Financial Planning. Burroughs believes just about everything in life can be more successful and fun if there's a solid plan behind it. In fact, her Christmas wish for everyone would be to subscribe to PLAN. The acronym stands for four basic holiday spending tenets, Burroughs said. P stands for putting money aside each month to have a nice nest egg ready to hatch by Christmas. L means making a list of everyone for whom you'll buy gifts. Include decorations, greeting cards/postage and entertaining. The list should further state what you can realistically spend, Burroughs noted. A stands for always shopping with cash. If you leave credit cards at home, you won't be tempted to spend beyond your means, the certified financial planner suggested. N means never waiting until the last minute to shop. There may be more bargains, but that might tempt you to buy more, Burroughs concluded. "If you don't have a lot of disposable cash, setting some aside for Christmas can be difficult. If you have some other savings and want to use it for Christmas, you can control your spending by writing yourself a check from that account. It would be just as if you received a check from a Christmas club," said Burroughs. Telling likes to see holiday shoppers plan a Christmas budget no later than the day after Thanksgiving. The 14-year credit counselor advocates tracking every dollar a person spends for three months. The exercise not only shows what a person spends money for but also reveals a baseline of expenditures that must be met every month, such as rent, car payments, utilities and groceries. "Determine those expenses and the number of gifts you want to buy. You'll know the amount of money you have available. If you don't have as much money as you'd like to spend, you could always take a second job for a couple of months," suggested Telling. Once a plan of attack has been developed, the hardest part occurs -- sticking to the plan. Baker, in charge of credit services for Bloomington's Mid-Illini Credit Union, said to stay away from retail store credit cards that offer 10 percent off a first purchase. Burroughs and Telling concurred wholeheartedly. "You'll have a higher minimum monthly payment on a $200 purchase than the $20 you got off the purchase. And once you get the cards, you don't take them away from yourself. You are going to use them," said Baker. It's often difficult to keep track of expenditures on one credit card, Baker added. Credit card debt, she noted, is one of the biggest problems for anyone on a budget. She sometimes sees people post-Christmas with four credit cards and balances due on every one. "Credit problems can snowball quickly. You can damage your credit rating, and it takes a long time to get back to where you were. Don't wait until things get bad to do something," said Baker. "Always look at the interest rates you're paying on a credit card. You do not want variable rates. Credit unions offer lower credit card interest rates that are not time limited." Mid-Illini has a credit card with 5.99 percent interest through February as a holiday special. Once the special expires, rates will be as low as 7.99 percent. Baker added that credit can be consolidated into one, low-interest card. Balances can be transferred to the card with one monthly payment due. She suggested credit card owners try to pay interest along with each monthly minimum payment. "Christmas accounts are a good way to save. You can also shop sales and look for the best buys. Make a list and stick to it," said Baker. "If you're on a tight budget and just have to impress someone, try looking for a gift at a pawn shop. You pay cash and get a receipt to track your expenses." Article Reprinted Courtesy of The Pantagraph 
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