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Exchanging gifts at a holiday Christmas party.

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The holiday season may be a time for cheer, but a little too much glee when it comes to spending can lead to massive headaches in the new year.

Social pressure to spend on parties and gifts can be higher during the holidays, a time when it's also easy to get wrapped up in the festive spirit.

It's a problem Krystal Yee, 31, knows well. The marketing specialist and financial blogger found herself with more debt than she'd hoped for after university, and her plan to cut back often left her at odds with her friends, especially during the very social month of December.

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"It is really hard to cut back through the holidays because the holidays are generally a time when you try to see all your friends and family and there are parties and activities and dinners," said Yee, who lives in Vancouver and writes a blog called, ' Give me back my five bucks.'

"It's about prioritizing and being realistic. Maybe you can't buy a dress for every party and you can't go to every single dinner, but maybe you can not go for the dinner and go for after-dinner drinks."

Colin Montgomery, a financial adviser with Edward Jones in Regina, says one of the biggest problems with spending around the holidays is that if you don't go into the season with a budget in mind, you're likely to treat the month as a running tab of dinners, parties and gifts – only to be surprised by how much you spent when you tally it up in January.

"If going out for a social event or Christmas shopping, leave the credit card at home, decide how much you're willing to spend and take the cash with you," he said. "When you're out of cash, your shopping trip or your party is over."

Yee said one of the hardest parts of living on a budget was to resist the social pressure to spend.

"I found it increasingly difficult to have to explain to my friends that I can't go to the movies or I can't go out for dinner because I need to put this money somewhere else," she said. "It wasn't until I found different tactics to get around that it really started to improve."

Those tactics included choosing different (and cheaper) activities to do with her friends and taking the lead in organizing events that were more in line with her budget.

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She also started making games out of "challenges," such as bringing a lunch to work every day for month, to turn a basic need into something fun that others could participate in.

But one of her most helpful decisions was to be honest with her friends and explain that she was trying save money because she had the goal of being debt-free.

"I think that people can really relate to that and it's not until someone can actually be honest that other people may say, 'I feel like that too,"' said Yee.

Brent Reynolds, vice-president of marketing and analytics at Capital One Canada, said speaking with others honestly about your financial plan is a good way to make sure you stay on track.

Financial Institutions, like Capital One, also have online tools that can help keep your spending in check. One of their applications, for instance, alerts customers when they're getting close to their credit limit or to a certain pre-set amount.

And if convincing your friends to get on board proves difficult, Reynolds suggests starting with yourself by cutting back on "spending vices" like coffee, cigarettes, and dinners and lunches out.

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"You can indulge yourself occasionally, but still stay in within the limits of your financial plans, he said.

To Yee, the important thing is keeping an eye on your end goal.

"When you realize that it's about empowering yourself to make the right choices and it's not about depriving yourself of things, once you change that mind set then that really is going to help you achieve whatever it is that you want to achieve," she said.

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