One of my favorite holiday songs is the Twelve Days of Christmas. It’s a fun song to sing, but if you were to open up your wallet and indulge in paying for all of these gifts for your true love, the cost of the Twelve Days of Christmas would be $87,403.00. Wow! That’s quite a Christmas present.

Imagine if you were to put your true love’s gifts on a credit card that had a 17.99% interest rate that required a minimum payment of 2.5% of the balance. Your minimum monthly payment for the Twelve Days of Christmas would be approximately $2,185.00. If you were to not put anymore debt on this credit card and consistently make monthly payments of $2,185.00, it would take you 42 years and 6 months to pay off the Twelve Days of Christmas. You would end up paying a total of $122,326.97 in interest for your true love’s gifts. By using a credit card, you could potentially pay $209,729.97 for the Twelve Days of Christmas, which is more than double the original price!

In reality, many of us this holiday season aren’t going to spend anywhere near the Twelve Days of Christmas. However, hopefully this gives you a clear lesson on the costs of using a credit card to pay for your holiday gifts. If you don’t have the ability to pay the balance off at the end of the month, you should probably reconsider using your credit cards.

Here are three tips to help you be more frugal and avoid getting caught up in the holiday spending madness:

• Create a Christmas Budget - Don’t start your holiday shopping until you know how much you have to spend. National Retail Federation estimates that the average consumer is going to spend $682.74 on this year’s holiday-related shopping. Ideally, your holiday budget shouldn’t include adding more debt to your credit cards.

• Make a Shopping List – Write down a list of everyone you want to give a Christmas gift to this year, the type of gift, and the dollar amount you want to spend on each person. Make sure the amounts don’t exceed your overall holiday budget. If you budget doesn’t stretch far enough, consider getting group gifts or making a few homemade Christmas gifts. Make your list early enough to give you time to shop for holiday deals on

• Don’t Shop Last Minute – When you wait till the last minute to shop for your gifts, you don’t leave enough time to research the best deals and risk the chance that what you want is out of stock. Basically, you’re putting yourself at the mercy of retailers. You might end up buying gifts for the sake of giving rather than getting something that you want.

Remember, your love isn’t about how much you spend, but rather the thought behind the gift. Hopefully, your true love will understand that you’re not going to be putting 12 Drummers Drumming, 11 Pipers Piping, 10 Lords a Leaping, 9 Ladies Dancing, 8 Maids a Milking, 7 Swans a Swimming, 6 Geese a Laying, 5 Golden Rings, 4 Calling Birds, 3 French Hens, 2 Turtle Doves, and a Partridge in a Pear Tree underneath the Christmas tree.


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