Freelance finance

Oh, it's the most wonderful time of the year! As you cruise the mall, Starbucks Gingerbread Latte in hand, looking for Christmas gifts this year, you may begin to wonder what the executives at your credit card companies are doing for the holiday season.

Well, let the mystery be solved! They're popping champagne, doing jigs on their desks, and rubbing their hands together in excitement because the holidays is their time to make some "real" money.

Holidays make up the bulk of consumers' annual credit card debt. The average family has some $8,000 in credit card debt, and, as the holidays near this season, that number is climbing. I used to think the holidays meant I had to spend $50 on each person I knew, including my newspaper delivery guy, the bagger at the grocery store who I see twice a month, and the 50 people I oversee.

Now that the savvy financial girl inside of me has emerged, I realize I've been wrong all those years! Christmas can be a financially manageable time of year with a little planning and forethought.

One thing I always do is plan my gift-giving list. With my husband's brothers, parents, in-laws, step-children, boyfriends, uncles, and so forth,
there ends up being a whirlwind of people to buy for. So, first and foremost, we do several gift exchanges and we set a limit of anywhere from $25 to $50.

I also make sure to plan for fixed expenses - those people on who I know I'm going to have to spend money. Children are a fixed expense, and, by the time you get through the extra-special-tickle-me-Elmo, the new Nintendo Wii, and 1,000 other things, you've spent a small fortune.

Use the usual tricks of the trade by shopping during sales, looking for coupons and doing price comparisons online. Shopping ahead of time is my ultimate time- and money-saver. If you're an avid coupon queen, another trick to use is to track your savings throughout the year and vow to only spend what you've saved during the year. Every time I head to the grocery store for a bulk purchase, I end up saving at least $20 in coupons, and that's just for a family of two! Imagine what the savings could be for a family of four!
But if the fateful day arrives when you check your credit card bill and realize you have spent too much, here is some advice:

First, try to pay the amount in full and on time. Paying your bill on time makes up 35 percent of your credit score. If you can't pay in full, pay as much over the minimum balance as possible, but still make sure to pay that bill in full. Next, have a look at your interest rate. Even if it isn't high, consider calling your credit card company and asking for a reduction. Even on a small balance, a reduction of half a point can make a significant difference.

Next, if you weren't able to pay the balance off in full, calculate what you spent over the holidays and make a plan to pay it off quickly.

Finally, learn from your mistakes. A budget is essential to discovering where you spend money, so let your New Year's resolution be to make a budget with your family and stick to it. Plan ahead for next year's Christmas list, start drinking your homemade coffee instead of the $5 one, and get cracking on paying off that holiday debt!