Although it has been billed as “the most wonderful time of the year”, if you spend too much for those “Silver Bells”, you could set yourself up for a “Blue Christmas”. There are strategies to avoid overspending and all it takes is a little planning and a lot of will power. Here are 5 suggestions for avoiding holiday debt.

1. Create a budget
Evaluate your monthly expenses and decide how much cash you will have left over for the holidays. Remember that the holidays actually begin with Thanksgiving and run through New Year’s Day. In addition to buying gifts, you should also consider all of the extra expenses associated with travel, hosting friends and relatives, and how many extra meals and get-togethers you’ll be having.

2. Make a list and check it twice
Beware: the holiday buying season begins in earnest on November 1st. That’s right, like black magic all of those Halloween items that filled the shelves just yesterday are replaced with twinkle lights, stocking stuffers, and last minute gift ideas. To dodge impulse buying and the bargain hunting frenzy that puts us on the path of overspending, it’s best to have your budget and holiday gift list prepared well in advance. Since everything you buy during this time are actually extras, you should include them all on your list including greeting cards, wrapping paper, outdoor decorations, and even that little black dress for New Year’s Eve. To keep your list realistic and within your budget, compare prices online, that way you will be a savvy shopper and able to recognize a good deal from a bad one.

3. Save up
Most of us have to cut corners and save up for the extra spending that occurs during the holidays. The idea of the annual “Christmas bonus” used to be something that many Americans counted on. However, tough economic times have changed things and now it’s up to the individual to find ways to save extra cash for the holidays.

4. Avoid credit card debt
If you have to use your credit card for a purchase, chances are you can’t afford it. We’ve all been there, envisioning how happy this really big gift is going to make our special someone. We don’t really have the cash for it, but oh come on, tis the seasonInstead we should try to envision the finance charges that will roll in by Valentine’s Day.

According to the American Consumer Credit Council, the typical U.S. family spends $935.00 over the course of the holidays. The ACCC also reports that most Americans have three credit cards and hold $15,799 in annual credit card debt. The holidays come but once a year – imagine how wonderful it would feel to have $15,000 towards a down payment for a home, an extra mortgage payment, or home improvement project!

5. Keep it simple
Even during the holidays, less is more. Creating a budget, and sticking to a list are easier when you look for alternatives to excessive spending from the start of the holiday season. There are hundreds of resources in print and online for ways to be creative and spend less.

Stick to your plan, and unless you are grocery shopping or purchasing a specific item on your gift list, it’s best to avoid stores (including those online!) all together.

There are several reasons why a person would want to obtain a copy of his or her credit or debt report. One reason for a copy of one’s credit or debt report is to save a potential lender trouble. If an applicant walks into a mortgage company or car dealership prepared with his or her credit report in hand, the application process will be shorter.

An individual may also want to retrieve his or her credit report for the purpose of managing debt. It is much easier for a person to come up with solutions or negotiate with creditors if he or she has the report. Credit or Debt reports may also come in handy for filing for bankruptcy. The individual will have a list of all his or her lenders available for easy access. Whoever may needs to utilize their credit history can easily obtain a free credit report.

How to get a Free Credit and Debt Report Not many people know this, but a free copy of a consumer credit report is available to anyone who has been denied credit within the past sixty days. If a debtor is turned down for any type of credit, he or she is automatically eligible for this report. The consumer has a right to look over the report and investigate why the lender has turned him or her down. In order to receive a free credit report, the debtor must apply for such on the website of the credit bureau.

There is a section on the website that says “Denied Credit?” The debtor would simply click on this link with the mouse. Next, he or she will be given options on what to do next. He or she would select “Request my credit report.” The consumer will then be asked if he or she has received an adverse decision in the past sixty days. The answer is yes. Next, the consumer will be prompted to fill out personal information and answer questions regarding his or her identity. If the customer answers the questions correctly, he or she will be given instant access to the credit report free.

After this person takes the time out to review everything on the report, he or she will have an opportunity to dispute any account that does not seem familiar. The credit bureau will investigate each disputed account to check for legitimacy. Any account that the lender cannot prove belongs to the consumer will we erased.

If you are experiencing trouble paying your debts, you may have received notification that your assets are at risk of seizure by creditors. Missed mortgage payments can quickly lead to foreclosure and missed car payments can result in having the car repossessed. Creditors may even garnish your wages if you are severely delinquent on your debt payments. However, you don’t have to let creditors take your assets; there are ways to protect your property while working to get caught up on debt payments.

Foreclosure

Mortgage lenders pursue collection actions much faster than other creditors. The reason is because the loan amount is much higher and they lose money quickly when payments go unpaid. If you want to keep your house but are late on your mortgage payments you have two options.

First, you can contact your lender directly to negotiate a mortgage loan modification. A loan modification can change the terms of your mortgage loan, resulting in lower monthly payments. Lenders may be willing to lower the interest rate on the loan, forgive delinquency fees or penalties, extend the life of the loan or even suspend monthly payments temporarily.

Secondly, you can file for bankruptcy. When you file for bankruptcy, the foreclosure process is halted or prevented and your lender must give you time to arrange a plan through the bankruptcy court. Depending on the state you live in, your home may be fully protected from seizure in a Chapter 7 case or you can ensure full protect by repaying your mortgage debt through Chapter 13 bankruptcy.

Repossession

Secured debt lenders, such as a car loan lender, have more collection rights when attempting to collect on a debt than an unsecured creditor. The reason is because the property that you have in your possession is used as collateral in the event you default on the loan. There are two ways to stop or prevent repossession when you default on the payments.

Firstly, you can negotiate with your creditor directly. Your creditor may be willing to suspend repossession action while you work towards getting caught up on your payments. However, you must contact your creditor as soon as you miss a payment. If you wait too long to contact the creditor, you may not be able to arrange a deal and the property may already be in the process of repossession.

Secondly, you can file for bankruptcy to stop or prevent repossession. Again, the state you live in has specific bankruptcy exemption laws that dictate the amount and type of property that is protected from seizure during bankruptcy.

Wage Garnishment

Creditors use wage garnishment as a last resort collection attempt because to do so they must first obtain a court order. Wage garnishment can be serious and could lead to 25-50% of your wages being garnished each paycheck, leaving you in worse financial trouble. The good news is that you can prevent wage garnishment two ways.

First, contact your creditor to explain your financial situation. You may be able to negotiate a repayment plan that better suits your budget.

Secondly, bankruptcy can stop your wages from being garnished in most situations if you do not have the financial means to maintain an arrangement directly with your creditor. However, back due child support or back taxes rarely are able to receive protection under bankruptcy and may continue to be garnished by a court order.