I went into the holiday season planning to spend about $500 on my loved ones. Then I spent $450 on my husband and two kids alone. Whoops!

Fortunately, I had some extra savings that I could use to finish my shopping. But this little example helps illustrate the reality that it’s easy to leave our best intentions at home and get carried away at the mall.

When I saw University of Minnesota Extension Educator Rosemary Heins’ holiday tips in my inbox, I knew this was the perfect topic to kick off the Fix-Ups Club.

Here they are:

Prepare an overall holiday budget using realistic expenditures and stick to it. Some financial planners advise spending no more than 1.5 percent of your annual income. For an annual income of $50,000 that means a limit of $750 is budgeted toward holiday spending.

Set realistic spending limits. Take a hard look at what you can spend on each person. If it adds up to more than you can afford, pare it down. Do what Santa does and check the list twice. Have your list with you when you go shopping and check it often to stay within your limits.

Try to think creatively about how to reduce costs. You might give a gift of service such as gardening time for an elder rather than an item they have little use for. Draw names so fewer gifts are given, or make a gift.

Pay for gifts in cash, rather than using credit cards. This helps reduce spending because people think more carefully when paying with cash. If you do buy on credit, enter the amount of each purchase in your checkbook register, just as if you were writing a check. Keeping a running tally of the expanding balance should deter you from overspending.

Those are great tips. But let’s face it. The holidays are here. And if the money isn’t, most of us aren’t going to hang up a handwritten “Bah Humbug” sign on the door instead of a wreath. So I asked Heins some follow up questions about wise use of credit and discussing the sensitive topic of paring back on gifts if money is tight.

Q: What if you have to use credit for Christmas? Any tips?

A: This is a value statement on my part, but no one ‘has’ to use credit. Someone who already has maxed out their credit card limits or is close need not be digging their ‘debt hole’ any deeper.

If you are choosing to use credit, use common sense. Plan ahead and keep track of what’s being charged. Save and tally the receipts during or after a shopping trip. Jot down the amount being spent.

I have a spending cardholder in my wallet where the credit/debit cards are located for these notes. It’s not much more than a recipe card folded in half and taped on the sides and labeled Holiday Spending.

Another technique is to enter the charged amounts into the checkbook register. Then when figuring out the amount in your account, the charged amount is deducted and one really knows how much money is available to spend.

If you can’t pay the balance in full each month, some personal finance people suggest determining an amount that could be paid off in three months or less. Use this as a limit or guideline for how much to put on credit.

Q: Does it ever make sense to use financing deals or store credit card offers or is it best to stay away?

A: If one doesn’t pay their regular monthly bills on time, I would say stay away! Store financing deals are appealing but one does need to honestly ask if he or she could have the loan amount paid off in full prior to the end of the financing deal.
If it’s not paid off in time, the item has suddenly become much more expensive.

When considering a financing deal, divide up the purchase price by the number of months the loan is for. Make monthly payments even though you don’t have to. Either pay it to the finance company or pay it into a savings account to be sure the money is available when the bill is due in full.

Also, make sure you understand the loan product. Watch out for and avoid pre-payment penalties or loans that really don’t end. Managing money is behavior management.

Q: Any tips on talking to family members if you really can’t swing holiday gifts this year?

A: This may be hard to admit or deal with. If you want to suggest a change in gift giving expectations keep in mind it might be a relief to others, too. Families generally know what’s going on in each other’s lives, such as work problems or medical issues.

Be ready to share suggestions for change, such as drawing names, gifts can cost no more than X amount, gifts must be homemade items or say just sharing a holiday meal together is all that is needed.

Q: You suggest opening a Christmas account to save regularly throughout the year. Don’t they have terribly low rates? Isn’t it best to just open up a higher yielding savings account and do an automatic deposit each month?

A: Bank or credit union Christmas or Holiday accounts do generally have low rates. If one can open a higher yielding savings account, yes, do that. The label isn’t the important part; the regular saving habit is. The key is to make the habit as easy as possible to be successful.

Automatic deposit is a good method for achieving this.

Q: Do you think holiday giving has gotten out of control for some people? How to reign it back in?

A: Holiday giving expectations and actions are out of control for some people. One reason may be all the advertisement that builds people’s expectations of what a gift is. Reining it in requires individual, family and friend acknowledging the issue is a problem and making changes. Jointly agreed upon changes that set limits will change how the holiday is celebrated.

And sometimes we have to recognize and accept that others will continue as before. We only have control over our own decisions.

Q: How do you set limits for yourself and decide what to spend for your family members? Do you use a credit or debit card, or do you use cash?

A: Extravagant gift giving has fortunately never been an issue or a practice within my family. Dollar amounts to spend are based on what is needed by the person or some item they would enjoy, while keeping in mind what cash and other resources are available.

I use all three methods for paying – credit or debit card and cash. But I do have a habit of paying off credit cards in full each month.

Q: What do you think about gift cards?

A: Gift cards are a great way to give a gift without agonizing over is the color or size right. I feel the giver should have a good idea of where or whether the recipient will shop. Purchasing gift cards through a faith community or other non-profit can benefit that organization, too.

New Minnesota legislation that limits the devaluing of gift cards over time makes gift cards an even better alternative.

Q: How should parents talk to young kids in order to manage expectations about gifts? Some kids want Wiis or iPhones.

A: Parents are their children’s first teachers. Children are learning spending habits from Mom and Dad just by observing. Parents need to involve their children in activities to teach them about money usage through out the year, not just at holiday time.

The family needs to talk about money and its use. Developing a holiday spending plan together for the holidays could be a learning experience for all. If there are large ticket items on the want list, the family can set boundaries for spending.

For the more expensive items, cost sharing may become a needed rule. Often when we figure out how long one needs to work to obtain an item, it becomes less important.

Thanks Rosemary! If you have a question for Rosemary, or a tip to share about reining in your holiday spending, post it in the comments section below.

I was so surprised and thrilled by how much response I received for the Fix-Up Club– which I envision to be a supportive group of readers that will help each other reach our financial goals– whether it’s to get out of debt or fine-tune our savings strategy.

I know it took a long time to get this started. I hope it was worth the wait. About 25 club members attended a Fix-Ups Club live event at the Star Tribune in November. Financial educator Ruth Hayden spoke to us about money and emotions and financial  counselor Tara McCarthy explained the nuts and bolts of budgeting and credit. Both handed out lots of tools, which I will post here soon. Check back for the audio of the event that night as well.

This can be an expensive time of year. I especially feel the pinch because my kids and my husband celebrate birthdays in December. Add that to holiday tipping, gift giving, dinner making and charitable donations and by the end of the month I’m close to, if not in the red. I can say there have been plenty a Christmas where I used my gift money to pay off my debt. Sorry, mom. (She hates it when I spend gift money on bills).

So this week, let’s kick off the club with holiday help. I’m in the process of compiling some nifty online tools and lining up a debt expert to share some tips. I’ll post a Q&A with the expert and hope you will ask questions by leaving comments on the blog.

In the meantime, here are my top tips for not going overboard during this time of year. I hope you will share your tips as well. Remember: We’re in this together!

1. Make a list and check it twice. It’s fun to make impulse purchases, but doing so can be costly. Before I even head to the store, I make a list of who I have to buy for and how much I want to spend. Then I compare the dollar amount to the person’s wish list and figure out how I can get the most bang for my buck.
2. Practice thoughtful regifting. I know this is a controversial practice, but if done right, it saves money, reuses perfectly new things, prevents trash and debt! Don’t ever give someone something that you never would have considered for them. Make sure the gift matches the recipient. If it does, you won the regift lottery. Cash in that ticket!
3. Make giving the gift. If I face dwindling finances or the prospect of purchasing a gift for the person who truly has everything, I donate money to a cause that means a lot to them. It’s good for me becaues I can deduct the donation on my taxes, reducing my tax bill. It’s good for the recipient because they know you gave some thought to what issue or cause means a lot to them. Not only that, but I find that giving causes me to reflect on how rich my life is. That’s a gift that a package wrapped up with a bow doesn’t often provide.
4. Be honest! If you are facing tough financial times, don’t put on your jingle bells nd ignore it. Tell your friends and family that you want to cut back this year. Suggest you set a dollar limit on gifts. Introduce the idea of buying gifts just for kids, or picking names out of a hat. Give the gift of time or a service (To me, free babysitting is worth more than a pashmina or jewelry or a pedicure). The joy of gift giving should be overshadowed by a feeling of obligation. Think about why you exchange presents with the person in the first place. If it’s just because they buy you something, perhaps it’s time for a heart-to-heart.