My father likes to joke that the happiest day of the year is December 25, and the saddest is December 26, because that’s when the bills start arriving. While I’d like to chuckle at that joke, a pile of credit card bills isn’t really very funny - in fact, just thinking of it brings back some sad memories. Here are six ways to deal with a pile of post-Christmas credit card bills - and also prepare yourself for minimizing that mountain of bills next year.

1. Think carefully about what went right - and what went wrong - this year. There were likely some gifts you gave that were great bargains and others that were overpriced duds. What can you learn from that? What sorts of gifts are really great bargains for the people on your list? For example, I could spend hundreds on my grandmother, but one gift that will always make her really happy is gourmet coffee (and related supplies) - so why not just focus on finding gourmet coffee bargains out there.

2. Start saving for next year now - and do it automatically. Sign up for an online savings account, like one at ING Direct (the bank I personally use) or HSBC Direct (another solid choice). Once you’re signed up, set up the account to withdraw $20 a week from your checking account. Magically, at the end of next November, that account will have nearly $1,000 in it for you to spend on Christmas gifts (after 48 weeks, it will actually have somewhere near $970 in it, depending on interest). That can help pay for much of the Christmas expense and not leave you facing a mountain of bills.

3. Do your incidental shopping for next Christmas in the next week or so. The week after Christmas is the best time to buy wrapping paper, ribbons, cards, tags, and so on for next Christmas. Pick them up at 50% off (or better) right now, then toss them into storage for eleven months. You can save some decent cash doing this. We do it every single year.

4. Make your Christmas list now for next year. Make a list of everyone you plan on buying gifts for next Christmas, then start keeping an eye out for gifts right now. For example, I have next year’s list largely ready to go, along with gift ideas for many of the people. This enables me to spend the entire year finding huge bargains on great gifts. I just simply look for the items on sale over the next twelve months.

5. If you’re going to drop your Christmas shopping on credit next year, make sure you at least have a decent credit card. Don’t just use the trusty ol’ generic MasterCard or Visa in your wallet. Instead, investigate other options and move to a primary card that can actually stick some useable and valuable rewards in your pocket. Our primary card gets us about 3% cash back, for example, when averaged out over all of our purchases.

6. Look for “better” ways to pay off the bills. Your local credit union or bank might give you a low-interest personal loan which you can use to eliminate your high-interest credit card debt - alternately, you could consolidate all of it via balance transfer onto a card offering a 0% APR balance transfer. You might also use this opportunity to clean out your closet and get rid of a bunch of stuff you don’t really need, selling it on eBay or at a local consignment shop.

As for us, we’ve actually already made our 2008 list of people to buy for, and we’re headed out to buy wrapping paper, bows, cards, and the like on Friday.

As I sit here surrounded by torn wrapping paper, empty boxes, and a room full of children happily playing with Game Boys and puzzles and Matchbox cars, it occurs to me that this is the first Christmas since I was still in school where I didn’t have an underlying nervous sense of worry about how I was going to possibly pay for all of the gifts.

I know that many of my family members used plastic to cover their Christmas gifts. One friend of mine actually did a house refinancing to get rid of the credit card debt of this Christmas and of Christmases and other unnecessary purchases.

It is a deep psychological relief to not have to worry about any of that. I just stick to one basic principle - spend less than you earn - and I work as hard as I can to make that gap between what I earn and what I spend as big as I can. The end result of that is financial freedom - the ability to do the things I want to do.

Financial freedom isn’t about the best way to manage your bank account - it’s a tool to get there.

Financial freedom isn’t about optimizing your investments - that just ensures that your money is doing good things for you.

Financial freedom is about being able to sit here with a glass of egg nog, watching a house full of people enjoy their Christmas presents, and not have the slightest bit of worry about anything more than when the traditional Christmas ham is going to be done.

It also means that I can give the gifts I truly want to give without worrying about the money, and it means I can sit here and laugh and smile and eat Christmas cookies without any real worry in my heart.

It’s truly the best Christmas gift of all.

Just a quick note to wish you all a merry Christmas! My Christmas has been quite merry so far: a Mexican-themed Christmas celebration (with lots of Corona), an excited wife receiving a Roomba and an Amazon Kindle, a son who can’t stop playing with his new tractor and his massively expanded Lego collection, and a big pile of cookbooks for me to dig through (last year, many of my gifts were financial books - this year, I’m getting lots of cookbooks).

The best gift of all? The smile on my father’s face when he opened up his gift. He’s been a fisherman his entire life and I spent a long time searching for and finally finding the single best fish filleting knife that I could possibly find, perfectly made for his hand dimensions. The efficiency of the knife will help him to keep making perfect fillets even as he grows old.

I hope your Christmas is merry as well.

I finally fiished my Christmas preparations this morning, wrapping up the final presents and placing them under the tree. The only other things to be done are food preparations and perhaps a stocking stuffer or two.

I’m very happy with the Christmas choices I’ve made this year. Some of them were really good ideas that the recipient will truly cherish. Others were astoundingly great bargains on quality items. Each one, I think, speaks directly to the person who’s receiving it in some way, which is really what I yearn for most in a Christmas gift.

Yet, somehow, with all of these presents and other items, I’m somehow left feeling empty. Even though I made some very frugal choices this year, I spent a lot of money. We tried to give a thoughtful Christmas gift to everyone who has value in our lives right now: my immediate family, my siblings and their families, my parents, my wife’s parents and siblings, and my current close circle of friends. No matter how carefully we select gifts, this adds up to a lot of money spent.

Does it really mean anything? When I look at all of the gifts under the tree, I simultaneously see both the joy of giving gifts as well as the expense that went into it. Is that gift really a worthwhile expense at all?

What I’m really trying to show with each gift is a way of saying “I love you.” To me, that’s the purpose of a Christmas gift - to tangibly say to someone that they’re important to you and that you care for them. Because of that desire, it’s often easy to fall right into the trap of giving an expensive gift to someone and not worrying about the dollar amount simply because you do care for them and you do love them.

That’s fine if you’re in good financial shape, but so many Americans are not. At least one person very close to me has taken out a home equity loan just to pay for Christmas this year. Another woman in line in front of me at a store recently had her credit card declined while making a $25 purchase.

If Christmas is about saying “I love you” to the important people in your life, say it directly instead of just showing it.

Write some heartfelt notes to people and include them with a more modest gift. I’m planning on doing this with at least a few Christmas gifts this year.

Promise to do something truly thoughtful for the person instead of buying another present. One of the best gifts I’ve received recently wasn’t an item at all. It was a gift of a bed to sleep in and an evening alone with my wife, courtesy of a caring aunt who invited us to spend a weekend at her home. She pledged to watch our children while we spent an evening like we used to before the kids were born. Does it cost her anything? No. Does it mean a lot to us? Undoubtedly. Does it reflect a lot of familial love? Of course.

Better yet, at some point during your holiday celebration, take the time to sit down with each person you care about and tell them that you love them and thank them for being a part of your life. That will mean far more than any tchotchke you can stick under the tree this year - and all it costs is a few minutes of your time. Talk about a bargain.

Christmas is about love, not about who can put the best material item under the tree. Keep that in mind and don’t spend yourself into a giant mountain of credit card debt this year.

Yesterday, I wrote about the idea of an “it” toy for Christmas, including tips for how to find a hard-to-get toy and how to talk to your child about it if you don’t get them their most desired item. This brought up a bevy of comments criticizing the post. I thought Elizabeth summed it up well:

Hi Trent. I love your blog and respect your opinions but I have to say that the very idea and existance of “it” toys offends me deeply. On principle alone I wouldn’t walk across the street to get an “it” toy for free.

I defend the right of marketers and manufacturer’s to try to build the aura of “it” for their products but I equally defend my right, as a mother, to keep my children from being exposed to the media that encourages “it” toys. And, if exposed, I stand firm on my efforts to help my children see that their lives will not be ruined forever if they never receive an “it” toy.

This is an interesting perspective well worth looking at, mostly because it wasn’t the angle I was even approaching the original article from. From my perspective, unless you homeschool your child in a media-less environment, they are going to be aware of the toys that other children desire and that will be a part of forming their own desires. If you educate your child on consumer issues well (for starters, read Born to Buy), your child should be able to recognize obvious marketing, but that doesn’t mean that any child will disdain an enjoyable toy or will completely ignore the interests of their friends.

Some of the commenters on the original post (like Elizabeth above) seem to actively avoid any heavily marketed toys and would refuse to buy them for their children. On the other hand, parents who expose their children to rampant consumerism and marketing are likely to have children that desire whatever the heavily marketed toys of the year are.

I’ll confess that I don’t like either approach, and here’s why.

I am a strong believer in educating my children about consumer issues when they’re ready. With my two year old, my current approach is to basically eliminate his exposure to persuasive advertising, but to wander with him through the toy aisles at stores and also having a strong idea of what toys he enjoys most at home. His most beloved toy at the moment is his giant bucket of Lego Duplos, so I have no problem with him being very interested in the Legos. He also enjoys small toy cars as well, so we tend to look carefully at the cars. We often put him into simple buying situations, too.

He’s already learning that he enjoys some toys more than others and I make sure to remind him of this when we are looking at toys in the store. “Remember, you play with your cars a lot at home… wouldn’t you rather spend your dollar on a handful of used cars than on that plastic tricycle?” is something I actually asked him at a yard sale not long ago. “You have a tricycle at home to ride!” He chose the cars.

Of course, often he makes choices I view as bad, but I strongly believe in freedom of choice. He might get a toy, play with it once, and forget about it. If that happens, I pull it out a few times again just to reinforce that he doesn’t like it, then put it in storage with the eventual goal of moving it onto Goodwill. Over time, we’re both building a sense of what he really likes and doesn’t like.

What does this have to do with the “it” toy? Let’s say, hypothetically, he comes home one day requesting that “it” toy. Knowing my child, I’ll usually have a fairly good idea of whether he’d like it or not. If I don’t think that he will, I might point out similar toys that he didn’t like or suggest alternative choices that I think better match him.

If he persists, however, I will get him that “it” toy, even if I’m certain he won’t play with it. Why? It becomes another valuable lesson. I can point out to him that that toy wasn’t very fun after all and it becomes a very useful lesson in how marketing works.

As for a wish list, it’s useful for grandparents or other distant relatives who might not know the child as intimately as a parent will, but as a parent, such a list is pretty useless to me. A gift from the heart, a gift that really expresses an understanding of the recipient, is always the best way to go.

So, yes, I’m completely in favor of seeking out the “it” toy provided it’s in the context of some strong consumer education. Where I don’t like it is when a parent buys it blindly for their child without any context or anything else.

In 1983, when my wife was just a little girl, she wanted a Cabbage Patch Kids doll for Christmas. Her parents were unable to find one, but her grandmother apparently bribed a shelf-stocker at a TG&Y in rural Iowa to grab a couple.

In 1988, I desperately wanted the video game Super Mario Bros. 2 for Christmas. My father sat out on a loading dock behind a store for almost six hours, then bribed the guy unloading boxes with a $20 bill and five pounds of catfish fillets (my father was - and is - a small-scale commercial fisherman) to just put the game in his hands so he could go buy it.

In 1996, my niece wanted a Tickle Me Elmo. I was able to get one by going to a Toys ‘R’ Us store in West Des Moines, Iowa, waiting in line for three hours, then dashing for a huge display of them. I grabbed one, turned around, and tried to get out of the crowd when an old lady tried to actually take the toy out of my arms.

Why do this? For many of us, seeing the joy of a child receiving that one toy that they most want for Christmas is an enormous motivator. I know, certainly, that my best Christmas memories are of receiving that one toy I most wanted for Christmas, but I realize now that on some level, I realized that it was more than just the mere gift. I knew that my parents had gone through a lot of effort to get the item and make sure that I had it that year for Christmas, and I knew it was because they loved me very much.

In the end, I don’t really mind putting in a lot of effort to get that one gift that a child wishes for the most - I’m much more bothered by a mountain of gifts, as I’m a big believer in the idea of diminishing returns if a child receives a lot of presents. Thus, my gift-giving strategy usually is two or three great presents, period.

There are a lot of ways to track down that “it” gift each year:

Go shopping early on a Sunday morning. This is the time when most major retailers put out the items listed in their flyer, so if you spot a highly desirable item in a store’s flyer, you should get there early on a Sunday to procure it. I know that I used this strategy to get my Wii earlier this year.

Talk to the people in the store where you might find the item. Just ask when they usually receive shipments and whether or not they’ll be receiving a particular item soon. Even better, if you have a friend who works there, work out an arrangement where they can directly help you pick up the item (hopefully, it won’t involve you sitting out on the dock).

Call around. If the item is not sizzling hot, but a bit hard to find nonetheless, make it a routine to call a lot of local stores asking for the item on a regular basis. If they say it won’t be in stock, ask when it will be. If they don’t know, ask to talk to a manager. Sometimes, the item will wind up being ordered by that store.

Hit up Craigslist. Explain that you are trying to find a particular item for your child for Christmas and are looking for any pointers or people that have one for sale. This isn’t a guarantee, but there’s a decent chance you’ll find the help you need - but often at a premium.

The lazy solution: use eBay. For high demand items, eBay (and/or other online auction houses) is the best place to find a high-demand item - but you will pay out the nose for it. Stick with highly trustworthy sellers, too - again, you’ll have to pay a premium. However, in the end, you will get your item this way. This is definitely the lazy way to the solution.

What if you can’t afford or can’t locate that one item that your child most wants for Christmas?

Don’t make a big deal out of it. Bringing it up yourself and being upset about it will just stir emotions in your child. If your child is disappointed at Christmas, be simple but firm about it and just move on with life. If the

Find other items that the child wants. Never get in a situation where a child’s Christmas wish list consists of one item. Make sure that there are lots of items to choose from, so that even if one is a clear favorite, you still have many options.

Spend time with the child. Time is the best gift you can give, not a Nintendo Wii. Play a board game with your child, or take the child to a park, or just watch a movie together. That will mean far more to the child in the long run than a snazzy gift.

Thoughts and good stories about getting an “it” toy for Christmas are welcome in the comments.

When I started working on this post, I was trying to make a list of Christmas (or other winter holiday) gift ideas under $10 that would be great to give for family gift exchanges, as stocking stuffers, and so on. I easily made a list, but then I realized when I read through it that I actually would not like it if I received most of this stuff. If I wouldn’t like these frugal gifts, why would I ever recommend these things to you?

So I threw out the list and started over.

This time, not only did it have to be a good gift under $10 to make the list, it had to be one I would like to receive. Perhaps my tastes don’t match yours or the person you’re giving the gift to, but at least these gifts are known to appeal to someone.

That being said, here are twelve great frugal gifts I’d love to see under my tree.

High-quality basic tools My toolbox is filled with one dollar screwdrivers, most of which are stripped to some degree. A good, top quality screwdriver designed to last for years and years and years is a wonderful gift for a handyman - and can easily be found under $10.

Homemade powdered mixes I mentioned my hot chocolate powdered mix a few days ago, but I like any homemade mixes: spice mixes, popcorn flavoring mixes, and so on. Just mix it up and put it in a homemade jar and I’ll like it.

A memory stick full of memories If you have a USB memory stick sitting around, load it up with pictures, videos, and song files that express fond memories of the relationship you have with that person. Include a bunch of pictures of you both, your families, and so on. These can really be awesome.

A paperback novel that the giver really loves Think of the one book you’ve read in your life that had the most impact on you (or perhaps a small handful). See if it’s available in paperback. Bingo - great inexpensive gift. Even better, put a note inside the front cover that explains why you loved the book so much and why you want to share it.

A “coupon” for a big favor When my wife and I recently had a baby shower, one person gave us a coupon for a night of babysitting of both of our kids. It was the best gift we received, and it only cost the recipient a piece of paper. This is a great gift for parents, especially ones with multiple younger children - it’s hard for them to find time together.

A single pair of very warm, high quality socks Seriously, I get a pair or two every year and they’re among my favorite gifts. Nothing’s nicer than warm feet, especially if you live in a climate with a very cold winter.

A container of homemade cookies The container doesn’t have to be anything special - a large Gladware container will do. But the inside should be filled with the best homemade cookies you can possibly turn out.

A day of volunteering Similar to the coupon for babysitting but with more appeal to the environmentally and socially minded folks, a day of volunteering can be a great gift for someone. Agree to spend a Saturday volunteering for the local charity of their choice, doing stuff like hammering nails or picking up trash. Better yet, agree to go with the person on a volunteering outing, or offer to watch their children so they can participate.

An old-fashioned safety razor This sounds completely crazy, I know, but you can usually find a beautiful one if you ask around at resale shops for far less than $10, and then package it up with some razor blades. I am a big fan of shaving the “old fashioned” way, with a safety razor, though I don’t always do it (I sometimes use a cheap disposable in the shower when I’m in a big hurry). If you know of a young man who is shaving with disposables, give this as a gift and just see what happens.

Quality pens I have a burning, undying hatred for cheap pens, but the cost difference between a cheap Bic and a decent pen makes me often stick with the cheap ones. Because of that, I love a great pen as a gift, one of the low-end types you buy at a real pen store, not in the office supply section at Target. You can usually get a very nice pen for general use for right around that $10 sweet spot.

A picture frame Go find a nice, simple, elegant picture frame and gift it. Often, people feel obligated to put some picture inside the frame. Don’t. If you want to give some pictures, give several in an included envelope and say that they can choose one of those or anything else they might want.

A heartfelt, handwritten letter or note This one seems absolutely bonkers to some, but it is often the best gift someone can possibly give, especially to someone estranged. Sit down and take some time to just write a handwritten letter to someone important in your life. Tell them honestly how you feel about them, and if the relationship is strained, and put to rest any bad feeling you might have about the situation. It will leave you feeling much better and will often move the other person to tears.

Each year at Christmastime, I identify a particular charity that fills an important need in a community. I usually choose one that I have a personal connection to, having visited the facility and/or have had a close friend or family member working there, and the charity must be in line with my personal values of helping people who truly need help. If you wish to give a Christmas gift to charity this year, I truly hope you’ll consider this group.

L’arche Tahoma Hope is a small group of four homes in the Tacoma, Washington area. These homes open their doors to adults with mental development disorders, providing them a place to live in a communal environment with their peers and with a staff that lives on-site with them. A typical home consists of four to ten people - assistants plus “core members,” where core members refers to the developmentally challenged individuals living there.

I’ve personally visited one of these homes. The one I visited had six developmentally disabled individuals living there, along with five assistants. At any given time during waking hours, two to three of those assistants were always involved with working with the core members.

What did they do? The home had a very large garden, and the assistants and core members all worked together as a group in that garden, raising vegetables and flowers that they would either consume themselves or sell to the public as a fundraiser. The more technical tasks were performed by the assistants and they also provided a lot of emotional support and friendship to the core members, who were largely involved with picking the vegetables and weeding and such.

The group also made paper mache flower pots for the plants out of flour, colored water, and newspaper. These actually turned out quite well, and if it were not for the fact that I was thousands of miles from home, I would have purchased one for myself.

At meal times, all of the core members and all of the assistants that were present would eat together around a large table as a group, sharing food and talking about their day.

I will be the first to admit that I do not have the spiritual fortitude or patience to do this job. I simply could not live there with the patience required day in and day out, and I am deeply thankful that there are people out there who do have that kind of patience and caring for others.

The truth is that most people don’t have that level of patience and most families do not have the support structure that is needed to provide for individuals with mental development disorders. For the most part, these individuals come from loving families who simply recognize that they don’t have the patience or the ability to truly care for them.

These homes provide a quality of life for individuals with mental development disorders that they simply could not find anywhere else in the world. They’re in an environment with their peers, where they’re not seen as outcasts, and with individuals who care enough about their situation to wish to live there and help them in many one-on-one situations.

I know that if I had a child with similar disabilities, I would truly hope that in adulthood, they could find a situation like L’arche to live in, and I am truly thankful that such places do exist and that there are people out there with enough spiritual and mental strength to work and live there, making a better life for people who weren’t given the same tools and abilities we were given at birth.

If you’re thinking of making a charitable donation this year for Christmas, please consider donating to L’arche Tahoma Hope Community. Take some time to visit their website and find out more about the amazing and life-transforming work that goes on there.

Furthermore, I will match all donations by my readers, dollar for dollar, up to $1,000 between now and December 25, 2007. All you have to do is donate to L’arche Tahoma Hope Community via JustGive.org and then forward the receipt of your donation to me - you can delete any personal information from this receipt if you wish. So, if you donate $20 to L’arche Tahoma Hope this year, I’ll match it and that gift becomes $40, and so on.

If you’d like, you can read about my 2006 charity drive for the Child Abuse Prevention Center of Dallas County, Texas.