Pre-Holiday Warning about Credit Card Use for Gift-Giving

Especially if you’re thinking about filing bankruptcy, resist the urge to rack up a big credit card bill for Christmas and other holiday gifts.  Otherwise you may find your hands tied about what debts you can write off in bankruptcy or even when you can file your case. But before getting to these legal reasons, there are some more basic ones.

When money is tight, your anxiety about paying for gifts and for special meals clouds the holidays. If you have room on your credit cards, and very little disposable income, the temptation to use the credit cards is just about irresistible. We live in a rather materialistic culture, so when we express our love and affection through gifts we tend to let their price carry too much meaning. We feel that an expensive gift shows how close we are to someone. We also let the gifts we give, and their price, define us and our own worth. We’re no good if you can’t give our loved ones nice gifts. That’s especially true with our spouse or that someone special, and with our kids. If we can’t give our sweetheart something really special, if we don’t fill under the Christmas tree for our kids, then we feel like we are not a very good spouse, friend, or parent. We don’t want to disappoint them, and have them be disappointed in us.

This feeling may be especially intense if there is tension in the marriage, or within the household, often the case when there are intense financial pressures. It can be a vicious cycle.

In our hearts we know that the price of gift is not a true measure of the extent of our love, and certainly that gifts don’t buy love. To help you follow your wiser impulses, here are three suggestions.

First, give gifts appropriate to your financial circumstances, no matter how modest those gifts may be.  That is the only responsible way, and in fact shows your love—especially to family members—a lot more than if you gave gifts you could not afford.

Second, put the energy that you would put into fretting about how to pay for a relatively expensive gift instead into creatively thinking about an appropriately priced perfect gift. Come up with something that reflects the connection between the two of you, one that the person will enjoy but also shows that you really put your heart into it.  

Third, whenever possible communicate honestly with your loved ones about your financial constraints. This has to be done the right way, preserving your own dignity, and appropriate for the relationship—different for extended family, spouse, your children. Instead of being negative, it can be a constructive conversation about priorities, honesty, and what love is really all about.

I know, this is lots easier said than done.

To help motivate you, in my next blog I’ll give you some legal reasons why piling holiday charges onto your credit cards can tie your hands in ways you don’t expect.