Holiday budgeting 101

If you think of the top five things to love about Christmas, spending money and the whole gift giving thing isn't in Tightwad's list. In fact, she thinks enough with presents already. Let's decorate, visit friends, go for long walks, sing carols and have a wonderful dinner. Alas, gifts always seem to sneak in so may as well do it with some restraint.

Budget! Making a budget is a no-brainer, but challenge yourself to go under budget this year. Track your spending to keep tabs on what you're shelling out and how much you have left.

Cut down on dining expenses 'Tis the season for dinners at pricey restaurants, but it is necessary? Replace the annual white-tablecloth celebration with an intimate potluck gathering at home. Throw in some group games and everyone will have a blast.

Refrain from personal purchases This one is tough during a time when bargains abound, but it's important to avoid when you still have people on your gift list.

Be resourceful The toughest part of budgeting for holiday gifts is not letting it eat into the money required for everyday items. Consider developing a menu for the week to reduce unnecessary food purchases and develop dishes around what you already have in your pantry. When you do head to the store to stock up on provisions, arm yourself with grocery coupons and a plan.

Trim your gift list The season often yields never-ending gift lists, especially when you're surprised by presents from people who didn't make yours. Trim your gift list to essential recipients and come up with inexpensive tokens for everyone else. Homemade goodies, cards with heartfelt wishes and offers of service (babysitting, for example) are great options for neighbors and coworkers and can be produced last-minute.

Do your homework Once you develop a list of essential recipients, bargain shop for gifts before making your final purchase. It's tempting to get all your shopping done over a weekend to get it out of the way, but doing so may mean missing out on budgeting opportunities.

Know return policies Retailers tighten return policies around the holidays, so be sure you read the fine print before making a purchase. Price matching is a good option, so it pays to know a store's policy on compensating shoppers who find better deals elsewhere.

Shop early...and late With all the advice circulating about when to land the best deal, it ultimately pays to shop throughout the holiday season.

Pay with cash Paying for purchases with credit cards is risky since the "I'll pay for it later" mentality breeds over-spending. The sight of cash slipping through your fingers will make you think twice about unnecessary or overpriced purchases, and help you stick to your budget.