Recently, conversations have been overheard about how bleak the Christmas season might be in 2009 because of economic and personal finance situations. Here’s a tip, however, that might keep it from being a total ‘bust’ for you and your family.

In the past, Christmas club savings accounts at your local bank were more popular than they are now. However, with the economy in the doldrums and job situations on shaky ground, these accounts just might be worth considering. Think about it: if you can afford to set aside a small amount every week beginning right away, you can have a nice amount in time for Christmas and earn some interest as well. And if you do happen to lose your job, at least you will have something in that account which is better than nothing.

Also, whereas banks were hesitant to handle these kinds of accounts in the past because of their temporary nature, they might not be as selective right now.

Are you a candidate? Traditionally those with lower incomes with good savings habits were good candidates for these accounts. Now, however, middle-income families have become candidates for them, too. Any savings vehicle that you can add to your arsenal only helps you financially – even if it is only temporary. It is not a bad strategy to keep $20.00 in the account instead of raiding it completely in November and December. Then, in January begin to build it up again.

How much? This is going to be an account that contains only between $300 to $500 total by the first of November, so the amount of $10 to $15 per week should be sufficient. Also, keep in mind that you are not trying to build up a massive amount of cash in this account. Other high interest bearing accounts are for that purpose. If nothing else, this keeps your Christmas from being completely without cash for gifts.

Automatic deposit. Use your bank and/or direct deposit payroll to make automatic deposits to this account. That way you never ’see’ the money in your check and chances are good that you will not miss it.  I highly recommend SmartyPig.com for your holiday account – it will automatically pull the amount you specify from your checking account on the date you select, and you’ll earn a great interest rate while you’re waiting for the holiday season to roll around again.

Be Frugal. If you know that you are going to have less money for Christmas this year then choose other means of giving things that cost less or nothing at all. For example, gift certificates for performing some tasks for someone that they would like and appreciate. Or, even making items like food or inexpensive crafts.

If you use these tips and implement them now the economy might still be in a slump come December, but you will still have a Merry Christmas.

Tags: christmas club, holiday savings, smartypig

This entry was posted on Wednesday, February 25th, 2009 at 8:29 am and is filed under tips. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.

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