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Holidays

Holidays meand kids, costs and considerations

By Lisa McKinnon
November 26, 2004

Parents plunging into stores in search of toys should whittle those wish lists

Black Friday, indeed.

The day after Thanksgiving is so named because the post-turkey dinner rush into stores once was thought to coincide with the very moment that retailers could see the red ink on their ledgers fade reassuringly to black.

For many families, however, the "official" first day of holiday shopping can have the opposite effect, sending them into debt as they struggle to make things merry and bright.

A common trouble spot? The urge to splurge on stuff for the kids.

Cute and persuasive, many children have very clear ideas about how to disperse the $702.03 that the National Retail Federation estimates each American consumer will spend during the holidays this year. But there are ways to deal with a child's multipage wish list without going to the extremes of filing for bankruptcy or turning into Ebenezer Scrooge.

As doting friends and relatives everywhere head for the toy aisles today, we offer words of advice from three Ventura County therapists and one nationally recognized financial expert, each of whom has made similar shopping trips for their own families -- and lived to tell the tales.

1. The younger the child, the smaller the price.

"I once heard someone say, 'This year, Grandma's only going to spend $300' -- and I'm thinking, 'The child is only 18 months old,' " said Linda Montoya, a licensed marriage and family therapist who has a practice in Ventura and three grown daughters. "At that age, children often are less interested in the toy than the box it came in."

Aside from the immediate danger of sensory overload, the problem with such largess is that a child may come to expect it every year -- and on birthdays, too. Now is the time to promote the message that less is more, said Dr. Mary Barreto, an Oxnard psychologist who also teaches an urban education course at California State University at Northridge.

"Parents need to know that whatever they give, the ante gets bigger every year, simply because our society is guided by materialism," said Barreto, who has a grown son and two young grandchildren. "If you keep it simple now, you stand a better chance of encouraging the message that (the holidays) are not just about presents."

2. Know your limitations.

It's the most credit card-tempting time of the year. So who better to suggest a safe-and-sane holiday budget than Consolidated Credit Counseling Services, one of the country's largest nonprofit organizations devoted to helping people get out of debt?

In addition to cautioning families not to spend more than the equivalent of 15 percent of one month's worth of take-home pay on the holidays -- cards, gifts, travel and entertaining included -- the organization also has devised a formula for determining how much to spend on gifts for children without breaking the bank.

First, add up what your household brings in each month after taxes. Then divide that amount by a percentage that corresponds to the age of the child in question (see accompanying graphic). In families with more than one child, the trick is to determine a percentage based on an average of the children's ages.

Janet Bodnar, executive editor of Kiplinger's Personal Finance and author of the syndicated weekly column "Money-Smart Kids," believes wholeheartedly in setting gift-spending limits. But a percentage-based formula may be too complicated, she said.

It also fails to take into account any less-is-more inclinations of a wealthy family for whom a percentage of the monthly household income may equal the Gross National Product of a small country.

"I don't think parents think in those precise terms," Bodnar said. "Most people have a dollar amount in their heads, a figure that can be divided by the number of kids and the number of gifts".

"The critical thing is to think ahead, to have a plan so you don't walk into a store and go overboard with the impulse buying."

 

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