Many retailers are scrambling to try and recover from poor holiday sales figures. Some retailers are even throwing in the towel after the difficult season. Most small retailers took a large hit due to the downturn of the economy. But how did the consumer do during this normally busy season? Indications are that many consumers spent far less than expected.

How did you do? Did you use this season to try and recover from some financial difficulties or did you spend quite a bit more than last year? Did you go severely into financial debt to pay for your holiday cheer? If you did not plan, you will have debts that become due now. This sometimes takes the fun out of the Holiday Season. 

But what can you do to help yourself recover and prepare for next year’s festivities? Here are a few helpful hints to get your self back into the holiday mood.

1. Review your expenses during this holiday season. Determine what expenses were outside of your normal holiday spending.

2. Determine if everyone on your list got a gift or did you leave someone off the list due to the economy. (Many people were left off gift lists if the retailers are to be believed)

3. Make a list of who you would like to give gifts to this upcoming year. (Yes, it is not too early to make a list…)

4. Take that list and put a limit of what you can spend on that individual.

5. Now add that this up and divide by 12 (months).

6. This gives you what you need to put away each month to have a debt free holiday season next year.

Can you actually have a debt free holiday season? Most retailers would have said that it is not possible but they have been chewing their words this season. Imagine having a holiday season that does not have the dreaded opening of the credit card bills afterwards. Planning is the mother of invention and think about how nice a holiday season you could have without the extra bills. Additionally, as you deposit your “holiday” money each month you can add a little holiday spirit and maybe even sing a chorus or two of your favorite holiday song.

The holidays are almost over and it is the beginning of a new year. Financially are you ready for the New Year and should you start preparing now to pay for the holiday next year? It is a great time to review your financial situation and determine what direction you should take.

First, start with your holiday budget, did you go over your budget? If you did go over, was it because you did not plan enough or was it because you had an unexpected gift that put you over budget. If you just did not plan enough for each of the gifts you bought then you can prepare better for next year. But if you had to buy an unexpected gift that put you over budget then you might be right for next year.

If you take your total spent this year, then add about 5% for inflation, you should be in the ball park for a budget for next year. Take that figure for next year and then divide it by 12 months. Open a savings account and put that money in the bank at the beginning of each month and you will now have your Holiday money all ready for next year. Additionally, you might even have a little extra due to the interest each month that you are earning.

If you also are watching the sales or discounts that some retailers are putting on their wares, you might find that you can save some money by buying that gift early. You will have some money already set aside for just such a purchase and this will also help your budget. Each time you save some money you are helping your financial situation. If you don’t use your credit cards to pay for your holiday spending then you can save money by not paying for that item over and over due to the interest and such on a credit card.

I have known people that opened up several different savings accounts to help them keep track of their holiday spending. One for the gifts, one for the parties and another for the extra expenses such as increased electric bills due to the fancy decorations on their homes. You must decide which of these is necessary at your home and prepare for the next year.

Remember it is very important to start planning on paying off your holiday for this year as well. The credit card debt that you have incurred should be paid off as quickly as possible so that you don’t pay for your holiday for the rest of your life. Always make your credit card payment on time and in full each month. If possible, pay more than the minimum payment so that you can reduce your balance to around 30-50% of your credit limit. Then by making those payments on time and in full you will increase your credit score each and every month.

Living paycheck to paycheck is not uncommon and yet everyone feels that they are the only ones suffering from this syndrome. Many Americans feel this way regardless of the amount of income they bring into the home. If you look at your empty bank account on Tuesday and know that payday is Friday you are suffering from this syndrome. Here are some simple suggestions you can use to help you feel this syndrome less often.

First, find out why you are having this problem. Add up your Good Debt and then your Bad Debt. Good debt will include anything that is bringing in money such as a mortgage (equity) and school loans (future earnings). Bad debt will include anything that is costing you money, including credit card and automobile loans. If you have a lot of bad debt, then you should attack it aggressively. If you don’t have much bad debt and are still having the paycheck to paycheck syndrome then review your good debt. It might be time to determine if your good debt is too much of a good thing.

Next, you must determine which of your bad debts is draining you the most. Is it the interest or the size of the payment that hurts you the most? It is hard to say, but generally the interest is a good place to start. Try to reduce your interest by either paying the card off, or by transferring the balance to a lower rate card. Look hard at your credit card and personal loans. By getting them paid off or reduced to a smaller interest loan then your paycheck should feel a bump in the positive way.

If you find that you are forgetting to have the car insurance payment or do the holidays sneak up on you even though they are the same dates every year? Go through your checkbook and add up those items. Once you have that figure divide that by 12. Then take that money and set that aside every month. It will be separate from your everyday bills and use that money to only pay for those occasional irregular expenses.

Then you can set up an emergency fund. It does not have to be large amount of money but you can determine how much by reviewing your spending on anything that was completely unexpected. Putting that money aside for an emergency will help you when you have an unexpected car repair, appliance breakdowns and emergency travel. It could be your nest egg. Some parents start this account by working with their children. They set aside a tithing for themselves. This can be used to a small amount of their income to be an emergency fund. It does not have to be any set amount but if you teach a child to save as a child, then they generally save as an adult.

Finally, relax and put your feet up. Knowing that you are planning for your budget, your occasional expenses and finally your emergency fund is coming into shape will help you to sleep at night. You might even find that you can write a check and not panic if it is towards the end of the month. You might even find that you have money in your account from last month’s budget… What a concept!