Holidays
Lay out an affordable gift-giving plan - and stick to it
Guard your budget during holidays
BY LULADEY B. TADESSE
The News Journal, Delaware
Heather Smith of New Castle already has begun shopping for Christmas presents. She
and her husband, LeRoy, have decided to spend at least $300 more than they did last
year, but want to stay within their $1,000 budget. So the money will go mostly toward
clothes and toys for their 2-year-old son, Jaden, and cash gifts for close family.
"He wants a laptop," Smith said of her husband. "I said, 'You are not getting that.'
It's too pricey right now and he already has a computer."
About a third of American consumers start shopping for the holidays this month.
And many consumers are expected to stretch their wallets a little further this year,
spending more on gifts for family, friends and others. But financial planners advise
consumers to take a close look at their finances before they begin racking up gift
purchases.
"We work so hard trying to get everyone to get a budget and savings," said Evelyn
Baldwin, who teaches personal-finance workshops, including shopping for the holidays,
at the YWCA in Wilmington. But she said many consumers' financial goals tend to fall by the wayside when it comes to the holidays.
Before shopping, consumers should create a budget and calculate how much they can
afford to spend on gifts, experts said. The budget should be detailed and include
spending limits on specific items -
such as gifts for individual people, decorations,
party clothes and food.
Ideally, consumers should plan ahead and set aside holiday gift money during the
year based on how much they spent the year before. Regardless, consumers should
have a dollar amount in mind for particular gifts before walking into a store. Vague
budgets and gift ideas lead to overspending.
According to America's Research Group, a consumer behavior research firm in Charleston,
S.C., 38 percent of consumers usually spend more than they planned during the holidays.
One reason is that they wait till the last minute to shop for
gifts.
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"Starting to shop early gives you a lot more time to find better bargains and be
a better shopper overall," said Jim Tehan, a spokesman for Myvesta.org, a Rockville,
Md.-based company that offers financial-planning services.
Rochelle Tawyman, 42, of Newport, said she gets the best deals for Christmas gifts because she starts bargain-hunting months in advance. |
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"I start Christmas shopping the day after Christmas," Tawyman said. "I shop all
year round. That is the best way to shop."
Tawyman doesn't have a specific budget, but she expects to be done with all her
shopping by the end of the month and spend less than last year. Almost all of her
gifts have been bought on sale.
Consumers will spend an average of $702 on the holidays this year, up 4.5 percent from last year and the highest since 2001, according to a survey released last month
by the National Retail Federation.
