Christmas should be a joyous season, but too often people get caught up in the "giving" aspect far beyond their financial means.  They go into tremendous debt to buy gifts that might or might not last as long as the actual loan or credit card payments!  This is a tragedy of Christmas that too often gets swept under the rug.  Let's take a look at some credit woes during the Christmas season and how these can have lasting negative effects on your financial portfolio.

Overspending with Credit Cards

Credit cards can be wonderful for Christmas shopping.  They are easy to carry around without having to carry a lot of cash or write checks.  They enable you to purchase items in advance and pay for them later, so you can do your Christmas shopping early on.  Credit cards also give you the freedom to spend just a little more on a loved one to give them that special gift they've been dreaming about.  That's the positive side of using credit cards, but there's also a negative side. 

What if you can't pay the balance off before your grace period ends (which is usually 25 to 30 days)?  This means you'll be starting the New Year with a credit card bill and high interest to go with it.  What if you or your spouse lose a job or has a financial emergency, and you're stuck paying for Christmas gifts too?  Think about these things before overspending with your credit card.

Getting Caught Up in the Moment

As you're out and about during the Christmas season, it's so easy to get caught up in the moment.  You'll see decorations for the home and tree, fudge and shake shops galore in the malls, Christmas shops, huge sales, etc.  It's so easy to spend-spend-spend when out shopping with friends and loved ones.  But don't forget that real life still goes on during this jolly time of year.  Be responsible with your spending, even when out having fun.  You'll have peace of mind when all's said and done.

Size Down the Tree

The Christmas tree and tree trimmings can also present a temptation to spend too much.  Don't get into a contest with the Joneses over who will have the biggest, best tree or the most decorations on the front lawn.  Although it's great to have a pretty tree and lawn decor, you must not let pride interfere with your budget.  Get a durable artificial tree that will last for many years, but don't overdo it.  There are some very affordable trees with the lights on or off that can be stored safely away each year.  Also, your tree doesn't have to scrub the ceiling to be attractive.  Consider getting a smaller tree for less money, and then decorate it to full capacity with affordable ornaments.

Sales

Don't buy items unless you shop around first for sales.  You'll be surprised at the savings just by checking with a few stores or even at online shops.  Many consumers get caught up in the holiday shopping experience.  Without a second thought, they hand over their credit card and pay the highest price in town.  The lower "sale" price will be much more attractive when the credit card bill arrives in the mail!

Plan ahead so you can avoid these Christmas credit woes.  Racking up too much debt at once on your credit card during the holidays might hurt your credit score and cause lenders to shy away from lending you money if you were to apply for a home mortgage or car loan later.  With a little research, you can get nice gifts for loved ones without fudging on your budget.