Avoid Going Into Debt This Holiday Season

Nov. 28 -- While retailer and others rejoice at the arrival of America’s most lavish holiday season, many consumers equate Christmas with debt.

The best of intentions of many Americans, it seems, are no match for marketers fully aware that fortunes, not to mention careers, are made or lost in a five-week period that begins the day after Thanksgiving.

An annual shopping survey conducted by the International MassRetail Association, a trade group of retail companies and theirsuppliers, found Americans last year said they would spend anaverage of $849 on holiday gifts. They actually spent 20 percentmore, or $1,067.

This year, consumers surveyed by the Arlington, Va., trade grouphave set a goal of $828, down slightly from 1999. But “we believethat they will actually spend more, as they did last year,” a spokesman for the group says.

‘You’re Over Budget’

Why will so many shoppers spend more than they planned? “It’s effective marketing,” says Ronald W. Rogé, a financial adviser in Bohemia, N.Y.

“You go into the store with a list and they have all these impulse items out front. You [buy those] a couple of times and you’re over budget,” says Rogé, who recommends shopping online to counteract the in-store deals that are just too good to ignore.

But as personal debt levels rise, some consumers groups believe Americans just might rein in their spending this holiday season.

“The intention [this year] is to spend less, especially using credit cards,” says Mark Wolff, a senior vice president with the Credit Union National Association in Washington, D.C. Wolff bases his assertion on a survey released Monday and conducted on behalf his group and the Consumer Federation of America. The survey found one-third of Americans who plan to use credit cards for some of their holiday purchases are worried about being able to pay off their balances.

“There are a combination of concerns affecting consumer confidence,” Wolff says, citing higher energy prices, a volatile stock market and slower economic growth.