| THOUSAND OAKS, Calif
THOUSAND OAKS, Calif A memento with Depression-era humor helps Kristin Bertrand keep perspective as her family braces for a Christmas holiday without their home.
The small ceramic dish she keeps from her grandfather reads: "Cheer up, things could be worse." Then, in smaller type: "So I cheered up and sure enough things got worse."
Just a few years ago, Kristin and her husband Mike Bertrand, 36, were confident they owned their own piece of the American dream. They pulled in $140,000 a year, owned a house, two cars, a telescope and other gadgets, and had season tickets to Disneyland for their two kids.
But since they lost their home in May, the Bertrands live in a sparsely furnished rental in Thousand Oaks, California, and have cut expenses to the bone.
They've sold Kristin's set of wedding rings, given up a car and the Disneyland passes to get back on their feet. The dish, taken when Kristin's 90-year-old grandfather moved to a nursing home, sits on the mantel as a reminder.
"It's going to be a lean holiday for us," said Kristin, 36, who said the family has put plans to visit relatives in Idaho on the back burner. "I think this year we need to lay low."
Adding to their worries as the holidays approach, Mike just learned that his consulting contract, the family's main income, will not be renewed at the end of October.
The Bertrands' story will be played out in many versions across the United States this holiday season, where several hundred thousand people who lost their homes to foreclosure try to redefine how they celebrate with their families.
For the Bertrands, and others, past splurges for special occasions have already been cut out of the household budget.
The Bertrands have kept their 13-year-old daughter McKaylee and 10-year-old son Taylor in the loop about their financial troubles all along. The kids have long stopped asking for money for clothes or fund-raisers, they said.
While the family had once taken McKaylee and a friend to Disneyland to celebrate her birthday, her latest party was held at home with a borrowed karaoke machine and a jump rope that guests fashioned from glow-in-the-dark necklaces.
NOT JUST A NUMBER
More than one million U.S. homes were lost in foreclosure from the beginning of 2007 through the end of September this year, according to RealtyTrac. Credit Suisse estimates 6.5 million loans will fall into foreclosure over the next five years, with the peak coming this year.
Families who have already lived through the worst of their financial troubles -- due to inflated monthly mortgage payments, the plunge in U.S. home values, or layoffs -- have prepared for a low-key holiday.
But even people who have not fallen into dire straits expect to tone it down this year, frightened by a plunge in financial markets that has wiped out trillions of dollars of asset values and raised the prospect of a global recession.
Six times as many people say they will cut back on gift-buying as those who plan to spend more, according to a recent Reuters/Zogby poll. U.S. retailers are bracing for their most dismal holiday sales season in nearly two decades.
Virginia Washington, a 64-year-old grandmother to 10, is already planning a more frugal holiday as she struggles to make payments on the $207,000 loan on her dream retirement home in Tolleson, Arizona, which is now worth about $150,000.
"The spirit will be there, though many of the things you've gotten used to over the years may not be," she said.
Counselors who help people through the foreclosure process say that many families just aren't making holiday plans.
"They're not as concerned about what they're going to do for the holidays, it's more about what they're going to do to keep the home," said MaryEllen De Los Santos, a housing counseling coordinator with the Adams County Housing Authority in Commerce City, Colorado.
One outlier is Ann Neukomm, 57, a receptionist from Cape Coral, Florida, who filed for bankruptcy in May and now faces foreclosure on a mortgage she took out about two years ago.
She's thinking about using a small inheritance from her father to take her 17-year-old son on a holiday cruise.
"I'd like to do something with him because it's probably going to be the last time," Neukommm said, referring to her son's 18th birthday, a time when many American teenagers stop living with their parents.
De Los Santos, the housing counselor, said that in the past, families in trouble would pour into her office at the beginning of each year. Many of them could not make mortgage payments because they spent too much on the holidays.
Now she expects more people won't even make it to the holidays to overspend, and predicts a flood of cases starting in early December.
One question De Los Santos asks clients is: "Do you want to have this kind of Christmas, or to you want to spend next Christmas in your home?"
Archstone Consulting Chief Executive Todd Lavieri said his biggest concern is unemployment and job insecurity. The United States has lost more than 700,000 jobs since January and experts are bracing for massive layoffs ahead.
"Saving your money to save your house will have a direct impact on holiday spending, no question about it," said Lavieri, whose group expects this year's holiday sales to contract when adjusted for inflation.
The Bertrands' plight began when Mike lost his job in 2007. He has worked since, but always for lower pay.
"I was working, but I was making less money. I kept fighting and struggling to catch up," Mike said.
In February, he lost a second job. "That was pretty much the final nail in the coffin," said Mike.
"The fear was overwhelming," Kristin said of the foreclosure saga, which left her feeling guilty and helpless.
While the family was not required to make mortgage payments during the year that the Newbury Park house they bought in 2001 was in foreclosure, Mike and Kristin said nothing felt as good as making their first payment on their rental.
"It was the best therapy," said Mike.
The couple started a support group called Moving Forward (wearemovingforward.org/) to help others manage the emotional toll of foreclosure. They worry that the holidays will pile additional stress on families already struggling to keep their heads above water.
"We need to get through it without any casualties," Kristin said.
(Reporting by Lisa Baertlein; Additional reporting by Tim Gaynor in Phoenix and Tom Brown in Cape Coral, Florida; Editing by Michele Gershberg and Eddie Evans)