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How to Avoid Falling Into the Christmas Debt Pit

The momentary flash of happiness on the faces of loved ones while they unwrap their Christmas presents from you may turn into a yearlong struggle of paying back credit card debt.

The biggest culprits that lead to a hangover of holiday debt, according to financial planners, are a lack of planning and spontaneous shopping.

"People, for the most part, don't really have a spending plan in place for the holidays," said Marc Bacsafra, a financial advisor with Sacramento, Calif.-based Fountainhead Wealth. "They usually just think about who they want to buy presents for."

Holiday spending may rise to as much as $586.1 billion this year, that's up 4.1 percent from last year, according to the National Retail Federation, the retail industry's trade group. And a number of holiday surveys, including one from the NRF, show a growing number of consumers feeling cautious, but at the same time, they are also more upbeat about the economy. (Read More: Holiday Shoppers to Splurge on Themselves This Year)

Those optimistic feelings could lead to more confidence at the cash register, at a time when income growth has been stagnant. In the most recent report on personal spending and income in September there were signs that consumers were cutting back on saving in order to fuel their consumption. During the holidays, the risk rises that shoppers will turn to credit to fill in the gap.

Bacsafra said he has yet to meet a client who spent within their budget for Christmas. There is always that extra gift or an extra trip. The problem lies in people wandering in the store and looking around to find something that they would like for a present, according to Bacsafra.

The best plan, he said, is to come up with a dollar amount and divide it among people. Then, stick to the plan.

Bacsafra also suggests consumers ask themselves several questions when deciding on the right amount for their Christmas spending, such as: How robust was your income this year? Where do you stand with other financial goals, such as retirement?

A reasonable goal is to pay off the holiday debt within two billing cycles. However, Bacsafra said he has met clients still dealing with Christmas credit card balances deep into July.

Sticking to the plan is often the hardest thing to do because emotions get in the way. Timothy Maurer of The Financial Consulate, an investment advisory firm based in Hunt Valley, Md., has developed a strategy to tame the feelings and help keep his clients on track.

Except for the most analytical-type personalities, most people cannot eliminate emotions from their decision-making process, Maurer said. So he suggests to people to budget emotions into their plan by adding 25 percent more to their initial dollar limit.

"What we're doing here is predicting our emotions," he said. "And don't forget to weigh (the cost of) those painful emotions when you don't plan and have a Christmas hangover that isn't paid off until you get your tax refund!"

A stricter approach comes from Dave Ramsey, a financial counselor and an advocate of debt-free living.

"The first thing you need to do is look at your budget, and see what you can afford to pay for in cash this season," Ramsey said. "If you are married, agree on the amount with your spouse. Then, just like Santa, make a list and check it twice."

Include each person's name and amount that you are ready to spend for each, and don't forget any extra food, events, and charitable giving you might do during Christmas season, he suggested.

"If you buy one extra thing for someone, you have to take away from someone else on your list. Keep that in mind," Ramsey said.