Christmas in July

Yes, you just celebrated Canada Day so why would you start thinking about Christmas instead of sunscreen? Simple, because you need a plan.

It is pretty easy to get carried away at Christmas. Between shopping for presents, home decorations and big family dinners it is equally easy to put your financial health on the back burner. No matter what holiday you are celebrating in December, it is time to relax, regroup and spend time with family and friends. The last thing you want to do is cause financial problems after the fact.

It is time to understand what your budget is for the holidays and rev up your savings plan now. Use the Financial Cardio test to figure out what you can afford to spend on gifts, food and entertainment. You know you are in good cardio financial health when by the end of the month you are not out of cash, your bills are paid without breaking a sweat, and there is more money coming in than going out. The Financial Strength test will help you figure out what you will need to save over the next 6 months to keep your financial health on track. To take the Financial Cardio and Financial Strength tests click on the "Get Financially Fit" icon.

With a budget in mind it is time to make your gift list. Rather than just deciding what to give, jot down what things each person on your list likes to do with his or her free time. Keep the list in your purse or on your phone or computer. When you are out shopping and you see a sale item that matches the person on your list – you are on the way to not only checking items off but also saving money at the same time. If you have a sun worshipper, make up a beach bag with a towel, plenty of sunscreen and a beach book at the end of summer when all of those items are on sale. A movie lover? Wrap up a new popcorn bowl, popcorn and coupons for movie rentals from their favourite video store or a copy of their favourite movie on DVD.

Make sure you utilize the rewards that come with credit cards, frequent shopping and loyalty programs. Between gift cards, discounts and free items, savings can really add up. There are lots of unadvertised coupons and promotions made available on the internet. Check-out frugalshopper.ca or couponnetwork.ca to get deals for online and retail store/service purchases. But remember if you saved 50% on a gift it does not mean you buy twice the amount for someone. Stick with your list, do not expand it because you saved some money.

There are other ways to give at holidays that do not negatively affect your budget. We all seem short of time to do the things we really love, so giving of your time to help someone do what they love is a truly generous gift. Consider giving friends an evening or weekend of free baby-sitting so they can go out without having to worry about childcare. Give coupons to clean the garage, walk the dog, clear the driveway of snow, cut the grass or make a homemade treat once a month. The more you can do before the holiday season strikes the better time you will have actually celebrating the holidays.

If you are putting some of the expenses on your credit card make sure you either have budgeted enough to pay off the purchase when the bill comes in or are planning on continuing your savings plan to pay off any holiday debt in the first couple of months of the new year. Speaking of the new year, why not keep your holiday savings plan going after the holidays and turn it into a vacation plan for next summer?