Debt and Holiday Spending

Happy HolidaysAre you ready for the holiday rush and buying spree? Traditionally, the holidays bring us a time of sharing and giving. But the cost of giving has increased over the years and you need to be aware of the burden it could put on your financial situation. With the change in most individual’s financial situation over the past year, this is a good time to reevaluate your holiday gift giving.

Most families spend around $500 on holiday gifts. If you put all those gifts on your credit card, the end result may surprise you. Do you have any idea how long you will be paying off those holiday gifts if you can only make the minimum payment each month? Let’s do some math:

$500 of holiday gifts: Let’s say you charge $500 on your credit card and only make the minimum monthly payment of $20. Some credit cards now are around the 19.99% interest rate for long period payoffs, you will be paying on those holiday gifts for 3 years! And to top it off, you will be paying the credit card company an additional $153 in interest (see Bank Rate website – ).

What if your gifts top the $1000 mark: Now you have an after-the-holidays credit card bill starting at $1000, with the same $20 of minimum monthly payment and 19.99% interest rate. Are you sitting down? It will take you 9 years to pay off those gifts you purchased! The credit card company will be happy because you will pay them $1,167 in interest. Yes, that is correct you will be giving $1000 worth of holiday gifts to your friends and family, plus over time more than a $1000 gift to your credit card company.

Not to be a Scrooge, but there is a downside to credit card use if you can not pay it off in a month or two. Another option is the cash envelope and gift list method. Make a list of people you will be buying for, a dollar amount for each person and some great gift ideas you know they will love. Now hit the mall with list and cash envelope in hand. Your goal is not to purchase more than you have in your envelope.

A last tip to remember: the holidays are not always about the purchased gifts. Think back on all the unwanted, unneeded or forgotten gifts you have received over the years. If you were able to have something different from the giver, what would it have been?  What were the best holiday gifts you have received? Was it the homemade cookies, the framed children’s art work or just being able to spend time with your family and friends? The holidays are truly about sharing and giving; think about using your heart and mind instead of your credit card. Have a Happy and Financially Safe holiday!

Kimberly J. Howard, CFP®, CRPC® is a Certified Financial Planner and the owner of KJH Financial Services, a Fee-Only practice located in Newton, MA and Denver, CO (781-413-4879). Please visit us at or email Kim at Follow us on Twitter @KimHowardCFP.


When Your Senior Loved One Lives Far Away


By: Marie Villeza

Living far away from a senior loved one is difficult, especially if the senior suffers from Alzheimer’s or other serious medical conditions. You worry that your loved one may fall and break a hip. You wonder if the elderly family member is taking his or her medication.

At times, you may feel helpless because you want to do more to ensure an aging relative’s well being but you live too far away. If this describes your situation, consider helping your elderly loved one move into an apartment or assisted living facility so that he or she stays safe even when living far away from you.


Benefits of Downsizing When You’re a Senior

One of the best ways to ensure your senior loved one is staying safe and healthy is to help them move to a smaller home or assisted living facility. Older people with health problems often can’t care for large, rambling houses where they raised their children. They may not be able to go up and down steps anymore because of achy knees or feet.

If your loved one moves to a smaller home or assisted living facility, he or she doesn’t have to worry about extensive upkeep for a large house. Senior citizen apartments or condos provide lawn care and often housekeeping services. There may be medical professionals that check on the residents at assisted living facilities, ensuring that senior citizens take their medications.

These facilities cook all meals for residents and often provide social activities for them too.

If your loved one suffers from Alzheimer’s or dementia, assisted living facilities that cater to these kinds of residents offer close supervision and medical care as well.


Preparing to Move by Decluttering

It isn’t easy to sort through your belongings when you’ve lived in your home for decades. Cherished heirlooms, well loved furniture, knickknacks, photos and other assorted items provide countless memories to those who own them. They remind senior citizens of family and friends that passed away or significant achievements in their lives. In order to prevent your senior loved one from feeling overwhelmed, help him or her organize belongings to determine which to keep, donate or give away.

Of course this requires that you travel to your loved one’s home in order to help them. You may need to take a couple of weeks vacation to help your family member with the decluttering process. Visit the new home where your loved one will live so you can create a floor plan of the rooms. This will help you determine how much your senior family member can take to the new home.

The best way to accomplish this monumental task is to go room by room. Start with rooms that are rarely used, such as basements, attics or bonus rooms. Create three piles: a pile to take to the new home, a pile to donate to charity and a pile to give away to friends and family. By systematically going through each room, you and your loved one will stay focused on your decluttering task.

What if your loved one is having trouble making a decision about a certain item? Simply place the item in storage so your loved one can make a decision at a later time.

When you live far away from your aging family member, tough decisions have to be made. Should your family member move into a small apartment? Should your loved one reside in an assisted living facility? The answers differ depending on your loved one’s health and specific needs. Whatever you and your family member decide, by helping with the decluttering process  and locating a home perfect for his or her needs, you will ensure that the loved one enjoys a higher quality of life while passing through the Golden Years.