Halloween has officially howled off for the year, and you know what that means: Time to start thinking about Christmas (or Hanukkah, or Ramadan, or Kwanzaa, or whatever party you prefer).

You probably don’t want to trim that tree just yet, but there is a very productive way to get into the holiday spirit. December can often pack a painful wallop financially, so putting together a holiday fund can avoid racking up debt in the coming weeks.

Here are seven steps to creating your very own holiday fund and avoiding the credit card spending frenzy:

1. Figure out who you need to shop for: For most of us, the list of loved ones getting presents doesn’t vary too much from year to year (except for the occasional break-up or new baby). Write down all the people who will be receiving gifts from you, and not just family and friends. Don’t forget your dog walker, child’s teacher, postman, hair stylist, babysitter, housekeeper or whoever else deserves a big tip. You can use this handy guide for tips on how much to give (though I found it rather steep).

2. Decide how much you’re going to spend: You may have a big heart when it comes to gift-giving, but be reasonable when deciding how much to spend, lest your bank account pay the price come 2013. Once you have a number for each recipient, add up the damage. Add in costs for decorations, food, drink, travel, maybe some fancy duds. Then take a look at your income and decide whether you can afford what you’re planning to shell out, and adjust accordingly.

3. Sock funds away each paycheque: You still have a handful of paycheques until the big day, so decide on a set amount to earmark for your gift fund each payday. Transfer it over to a savings account to keep from spending it, or stow it in a glass jar (and your hair) a la Marge Simpson.

4. Keep your own change: Speaking of glass jars, set one up on your kitchen counter to collect the change you’ve got laying around. Every time you get home from work, empty your purse or pockets of toonies, loonies, silver and coppers, and you’ll be amazed at how quickly it adds up.

5. Give up something: 'Tis the season for giving, after all, so decide on what you could give up and then siphon that cash into your gift fund. Maybe it’s a month’s lattes or a new pair of shoes or a weekend’s beer budget, but your pain right now will be your gain in December.

6.Make it a cash-only Christmas: Once you’ve got the money in hand, use it. And ONLY use what's in that hand. Ban credit cards while gift-buying and you’ll find yourself being much more selective when it comes to making purchases. Allow a bit of extra time for comparison shopping, and escape December without incurring extra debt.

7. After the holidays, set up your new fund right away: It may sound ludicrous to even think of next year’s jolly red holiday in the cold, frosty light of January, but this really is the most practical way to deal with holiday spending. Think about it – if you manage to stow away $50 every month into a separate account (direct deposit from your paycheque), you’ll have $600 to play with next December without even breaking a sweat.

Shelley White is a Canadian freelance writer, editor and TV producer who contributes regularly to The Globe and Mail, The Huffington Post, The Grid and Spinner.com. Shelley is also a mother of two who aspires to never again carry a credit card balance.