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The 5 commandments of seasonal spending

When Shoppers Drug Mart turned up the Christmas tunes the very day the calendar flipped to November, a few people went a little, well, ballistic...or at least they showed enough consumer vehemence that Shoppers canned the music "until further notice." But while thousands of indignant customers complained on Shoppers' Facebook wall about Christmas creep and commercialism, the reality is that Christmas music or not, many of us overspend. According to the Bank of Montreal's 2012 Holiday Spending outlook, survey respondents plan to spend an average of $1,610 dollars (each!) this holiday season, 15 percent more than last year.

But while a better economy has left many Canadians feeling more flush than in years past, our debt levels are at an eight-year high, standing at more than $26,000 per person (and that doesn't include the mortgage). For many of us, this means that when it comes to holiday shopping, we probably can't afford nearly as much as we'd like to be able to spend. The question is, how to side-step the sweet seduction of holiday shops? You can start by following these five commandments for fiscally responsible holiday spending...

1) Thou shalt determine what you can afford

So you've all heard the bit about making a holiday budget. But we've got some contradictory news for you: making a list of everyone on your list and how much you plan to spend on them is not a budget. If only financial life was this easy (Hey boss, according to my current spending, my salary should be about $15,000 more per year. K? Thanks!)

[More: 6 holiday shopping tips you can take to the bank]

Here's how to figure out what you can really afford: Pull out your recent bank and credit card statements, and take a look at what you spend on essentials like food, housing and transportation. Those are untouchables, and they should always be paid in full and with cash (re:not with debt). If you're lucky, you probably have some money left over once those are accounted for. Maybe during most months you spend that money on things like dinners out, shopping, movies and other extras.

The goal for holiday spending isn't to add gifts and outings to that budget, but to make them fit; this often means cutting back in other areas. For those who have very little left after meeting basic expenses, get into the habit of doing some saving ahead of time to ensure you have some cash stashed away for the holiday season.

2) Thou shalt stick to the plan

Most people like to avoid writing down firm rules when it comes to money. It's a bit like sneaking a few extra cookies out of the package when no one's looking — if you didn't put them on a plate, they didn't count, right? But while a few extra calories may indeed go uncounted, there's no ignoring your financial indiscretions — come January, you'll get a full statement in the mail.

[More: Prepping for a holiday credit crunch: How to save money this holiday season ]

Rather than end up with a bill you can't pay, look at what you decided you could afford to spend for the holidays and find a way to keep track of what you're spending as you go. You can do this with a spreadsheet, a simple piece of paper and a calculator, budgeting software, or, if you need an excuse to spend more quality time with your smartphone, you can try one of several holiday shopping apps, such as GiftList or Personal Finance App. Keeping a running tally of how much money you have left in your budget should help to keep you on track — and keep you accountable to making those tough decisions and concessions you might need to make to get there.

3) Thou shalt learn to say no

We're not saying you shouldn't get your mom a present this year, but if you're serious about sticking to a budget, you're going to have to stop at someone. Unfortunately, the holiday season is probably the hardest time to put the brakes on, especially when we get sucked into feeling that we must give to all those people we've always given to.  Perhaps this year, it's time to start putting an end to rote gift-giving. Discuss the gift ban with the recipients ahead of time, or consider making (or baking!) a more thoughtful gift instead.

This commandment is especially important when it comes to buying gifts for yourself . According to the National Retail Federation, a retail trade association in the U.S., 'self-gifting' is predicted to reach all-time highs this year. And while the holidays are supposed to be a season for giving, isn't that up to Santa's discretion?

[More: Splurging on the host, saving the most this holiday season]

4) Thou shalt not justify stupid behaviour

So what if you caved? What if despite all the budgeting apps and admonitions against overspending, you went and bought a few things you swore you wouldn't. But then, these people do so much for you ... plus you got such a good deal ... and you decided you could afford to pick up that sparkly top you've been eyeing ... you can always pay it down later ...

Hello?! Do you see where this is going? This is what we typically do when it comes to overspending. We justify, we rationalize, we try to smooth out our guilt and impending sense of failure with some pretty solid-sounding excuses.

You don't have to spiral into a guilt trip, but if you overspend, acknowledge it, recognize what emotions triggered it, and look for strategies that'll help you to overcome the urge the next time. And if it isn't too late, you can always return a few things!

[More: 'Tis the season to splurge: 5 retailer tricks that make you spend more]

5) Thou shalt give unapologetically

TV chef and author Julia Child was well known for telling viewers never to apologize for what happened in the kitchen — or what they served as a result. Whether it's a meal or a gift, when we give, it's easy to become analytical and self critical and apologetic. Unfortunately, that does little more than draw attention to the fact that you feel your gift is inadequate. And, of course, that probably makes the recipient enjoy it a little bit less, too.

It doesn't matter how much you spend

When you hit the shops this year, remember that while holiday spending might feel essential, the people you love don't want it to come at the expense of your financial stability.  And nor should you.  It's about being 'nice' to yourself and others this holiday season. is a free personal finance and education site for women.

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