Help! I spent too much on Christmas

So you overspent. Holiday budgets aren't straitjackets

To Her Credit columnist Sally Herigstad
Sally Herigstad is a certified public accountant and the author of "Help! I Can't Pay My Bills: Surviving a Financial Crisis" (St. Martin's Press, 2006). She writes "To Her Credit," a weekly reader Q&A column about issues involving women, credit and debt, for, and also wrote for MSN Money, and, and has guested on Martha Stewart Radio and other programs.

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Question for the expert Dear To Her Credit,
I really overdid it on Christmas! I meant to spend only $100 on gifts for each of my kids, but that doesn't go far these days. I think I actually spent about three times that. To top it off, I found out I have to get my car fixed – after I already spent too much on Christmas.

What should I do? I have always paid my credit cards off every month, but I don't know how I'm going to do that this time. It kills me to think of paying credit card interest. – Lucy

Answer for the expert Dear Lucy,
Don't let a few bills ruin your holidays. Despite my own advice to make a gift budget and stick to it, I've often "adjusted" the budget in the checkout line, or when I've finally found something for the most difficult-to-shop-for people on my list.

That's why budgets that are too rigid don't work for most of us. They're like strict diets, and the minute we go off them, we throw the whole thing out. A rigid budget goes exactly as planned or not at all. When the perfect presents cost a little more and the car goes on the blink at the same time, it's likely to be the latter.

On the other hand, a budget that really works is a plan, and plans change. When you spend more in one category, you have three choices. You can spend less in another category. You can spend less in another time period. Or you can make or find more money to pay for it.

The best choice may be a combination of all three. You spent several hundred dollars more on Christmas presents than you planned, and car repairs hit at the worst possible time.

First, try balancing the extra expense with your other budget categories. Can you go without eating at restaurants, even at work, for a couple of months? Do you have enough clothes in your closet that you could not buy any more until your cards are paid off? Can you forgo cable TV or cut back to the most basic plan? Can you cut a streaming service (music or TV) to save some every month that could pay down your card debt?

If you can't save enough money to pay for it all when your credit cards come due, consider buying time by paying a little interest. It doesn't have to be too painful. Make sure you're using the credit cards with the lowest interest rates.

Those of us who don't usually carry a balance aren't always aware of the rates -- they may be lower (or higher) than you think. Use our credit card payoff calculator to figure out your interest expense if you pay as much as possible when the first payment is due and pay the rest within a couple of months.

Another way to buy a little time, if you're close to being able to pay off your balances, is to take full advantage of the grace period  on most credit cards. You generally don't have to pay interest on a credit card balance if you pay the balance by the due date, which could be more than a month after you make a charge.

If you don't pay it all by the due date, however, you pay interest from the transaction date. If you can almost pay off your balance, but not quite, try putting as many of your expenses as possible on a different card in the second month, so you can pay the balance in full on the first card. Then, work very hard to pay the balance on the second card before it comes due.

If, despite your efforts, that balance will have to stick around a few months, consider a credit card. If you have good credit, it's easy to find a one that charges no interest for a year or longer on the balance you transfter in. Just don't fritter away that interest-free time without paying.

Finally, you may be able to boost income. To find money to pay off your presents and car repairs, you may be able to work extra hours at your regular job, if you're paid by the hour. If not, you may be able to make extra money moonlighting, working another part-time job or providing a service. A quick way to make a little money is to sell something. If you and your family received the latest electronics this year, sell the old ones while they'll still do someone some good. And after the holidays is a great time to thin out old toys, sporting equipment, furniture, musical instruments and so on.

Most importantly, though, enjoy the holidays with your family!

See related: Extreme ways to tackle debt, Over your head in debt? 5 extreme budgeting ideas

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Updated: 05-23-2019