BOSTON (CBS) – This is a question that often comes up this time of year and it did again last week during the fiscal cliff special where I answered listener’s questions.

Recent surveys indicate that people are expecting to spend around $750. But I have spoken with people who spend thousands and those who can do it for under $200.

How much can you afford to spend? How much have you set aside for the holidays?

Review your budget.

If you are struggling and are already in a negative cash flow situation, which means you are spending more than you are earning, you need to reevaluate holiday spending.

If you are living paycheck-to-paycheck, meaning there is nothing leftover each week, do you want to go into debt for Christmas?

Many folks are still paying off Christmas come 4th of July.

But what if you have little kids? They don’t understand, nor can they really comprehend your need to budget. What can you do to make it happen for them?

Little kids don’t need a lot to make them happy. Sometimes the boxes are the best gifts. You can have a wonderful holiday without breaking the bank. Christmas and Hanukkah are about the children and being with the people you love!

For starters, no one else but the kids get any presents. Will the grandparents be buying the kids gifts? How about aunts or uncles? Share the kids’ wish list with them.

Try shopping on craigslist. The Goodwill or the Salvation Army stores also have toys to buy, some new, others slightly used. I got an American Girl doll at a church fair.

Five and six-year olds love to play pretend so I gave my granddaughter garbage.

I took grocery boxes; cereal, rice, pudding etc., filled them with crumpled newspapers, and glued them shut. Got a cash register and some play money. She had a store and she often sets it up on the stairs or couch so she can be where we are.

We have a Take It or Leave It area at our transfer station (that’s our dump). Last year our big find was a grocery bag full of Polly Pocket toys. Into the tub with some Dawn and Clorox and they were like new.

Next fall start going to yard sales. Look for things that can be used for Christmas gifts. Especially for kids under six. You can throw those plastic toys in the dishwasher or wash them in the bathtub and they look brand new.

USA Today had a Christmas budget they put together several years ago and I kept the article. Total for a 9-foot Douglas fir tree with the trimmings, gifts for family and friends, fancy food, cards, stamps, wrapping paper and bows, party clothes, tickets to the Nutcracker, babysitting and a new snowman cookie jar was close to $5,000 ($4,906).

That’s a lot of money! More than I plan to spend on Christmas even with a granddaughter to shop for.

One more thing:

A heads-up on our Money Matters newsletter. So many listeners call or e-mail that they have missed a segment and where can they get a copy. Well now every Monday morning you can get the previous week’s segments sent to you. To sign up you will need to go to


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