How Christmas Debt Leads to Bankruptcy

I recently joined a group of business people from Clovis for lunch a couple of times per month.  At the end of the lunch, each business tells the group their monthly "specials".  I have joked that I was not running any specials because my clients were waiting until after buying Christmas presents before filing bankruptcy.  It is a sad joke, but true.  Here are some statistics:

• The average person spends  just under $1,200 over the holidays – including food, gifts and travel
•  At least 23% of that was paid for by credit card
• 6 million people borrow to pay for Christmas each year
• When paying by credit card, people tend to spend 112% more than if paying with cash
• One third of bankruptcies filed in March site overspending at Christmas

A lot of the tips for staying in your budget for this Christmas are too late to apply for this Christmas.  However, as we head into the last week before Christmas, stay committed on not overspending for the last week.  Just because you are over budget now, does not mean you can give yourself permission to continue the spending spree.  Each dollar spent over than that you can afford will take twice effort and discipline to pay in January, February and March.  Tell yourself you are going to start be a financially disciplined person today!  You will thank yourself in January.  Happy Holidays!

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