Christmas is coming, but contrary to the lyrics of that old Yuletide tune, the goose this year is far from fat. In fact, your 2009 Christmas list may have shrunk significantly over last year, along with your level of disposable income, mainly because of the effects of the worst recession in decades.

Although Jamaicans have had a tough year, most people still want to enjoy the season. After all, what would Christmas be without ham and sorrel, or that trip to your hometown to be with relatives and friends? But while most people want to maintain those traditions, paying for the turkey and the trimmings may prove more difficult than ever.

Before you decide to cancel all festivities this year, consider the words of a wise man, more specifically the branch manager of Capital & Credit Merchant Bank (CCMB) in New Kingston, Owen Ferguson, who assures that a merry Christmas is possible for those who plan carefully. He was responding to a question from a reader who wanted to know, "How can I enjoy the holidays during a recession?"

A word of caution

Ferguson's advice begins with a word of caution against the tendency to overspend. He is encouraging consumers to come up with a plan before they begin spending.

"There's no substitute for financial planning, and it is something everyone can and should do. Sometimes, persons are of the belief that they can't plan because they don't have enough money, but that's not true," he asserts. Ferguson contends that since everyone has access to some money, we can all make decisions about what we will do with that money.

The CCMB executive says there are a few simple but important steps one should take in order to create an effective financial plan. Determining the number of persons your plan should include, such as your spouse, children and any other dependents, is among the first activities.

"You also have to figure out how much your lifestyle costs are every month. This you can do by making a comprehensive list of all your expenses, bearing in mind that the small amounts add up," he points out.

Lifestyle cost

Ferguson adds that once the lifestyle cost is determined, persons will then need to match that against the level of income, making adjustments so expenses do not exceed that figure. The banking executive also warned against spending additional income at this time of year.

"For those persons who may be lucky enough to get a bonus, regard that money as a down payment on your future and not as extra income to go spending," he said.

Now that you've worked out how much you can afford to spend from your regular income, Ferguson says, you have to employ some discipline to stick to that budget. Beyond that, he suggests some tips for the season and the New Year:

1. Conserve on utilities by turning off Christmas lights overnight, plan your driving routes before you leave home and make shorter phone calls to friends and family overseas.

2. Reduce discretionary spending on things like entertainment.

3. Keep credit-card spending to a minimum.

4. Consider giving more practical gifts, such as Capital & Credit gift certificates, that could help your loved ones develop good habits in the New Year.

5. Seek to renegotiate loans to take advantage of lower interest rates and more manageable payments into 2010.

6. Seek longer tenors on your fixed deposits now in order to lock in better rates if and when they begin to fall in the New Year.