Holiday shopping can bring January blues

MAT-SU - 'Tis the season for shopping madness. From one end of the Valley to the other, people are pulling out checkbooks and credit cards as Christmas nears.

While many would like to put off financial considerations until after the New Year, the secret to avoiding the post-holiday budget hangover begins now, according to experts.

"Usually what happens is you approach the season without a plan, then it isn't until January or February that you realize this is the grand total," said Larry Snider, CEO of Consumer Credit Counseling Service of Alaska.

The problem is so prevalent, CCCS offers a workshop titled "Surviving the Holiday Meltdown." While serious planners took the course this summer, one last session is slated for Nov. 30. More information on this workshop and other free counseling services from the nonprofit organization is available by calling (907) 279-6501.

The basics of the workshop are not really all that surprising - set a budget and stick to it.

The first step, Snider said, is figuring out how much money you can really afford to spend. Rather than shopping now and balancing the checkbook later, set a limit first for how much you can spend.

"If your goal is to do the holidays on a cash-only basis, figure out how much cash you have available," Snider said.

While the advice may fall on many deaf ears, experts say it really is best to avoid using credit cards and instead, only spend what you can afford at the moment. If you do use a credit card, plan on paying it off. Some experts recommend actually deducting the credit card payment from your checkbook balance before the bill even comes in. That way, you know how much you have really spent.

"If you are using credit, you need to know how the bills will affect your budget in the coming months," Irene Leech of Virginia Tech wrote in a Cooperative Extension publication. "Under normal conditions, your monthly credit payments, excluding your mortgage payment but including car payments, should not exceed 15 percent of your take-home pay."

Once you have identified how much you want to spend and where it is going to come from, Snider said you should use that to determine your list of gifts. Write down each person and a dollar amount. Some people actually carry this list with them while shopping to keep a running Christmas tab.

As a general rule, Snider said, you should only buy those gifts that fit into the dollar limit you've set. If you find a perfect present that is perhaps a bit beyond your goal, wait on it. If you spend less on several other gifts, you may be able to return and buy the more expensive present without breaking your piggy bank.

"This means the sooner you start, the better," Snider said. Procrastinating not only means fighting the worst crowds, it can also mean not having the time to find the best deals and carefully stay within your budget.

If, when you are making your list of people you would like to give presents to, you find you simply don't have enough money to buy them all something, consider alternatives.

"Think in terms of non-financial gifts . . . like your talents and company," Snider said.

One way to spread out the burden is to give gifts that are reimbursed in the future, such as a homemade coupon to go out to dinner later in the winter. For teens, especially, Snider said a good gift is a coupon book of events such as a slumber party with pizza, ice skating with a friend or a trip to the movies, with one coupon being redeemable each month.

And no matter what the gift, don't forget the added expenses of wrapping paper, cards and postal charges. Here, again, planning and a personal touch can save money. Snider pointed out that postal charges get more expensive the more quickly you want something to arrive, so mailing gifts early can save money. As for wrapping paper and cards, homemade saves money and makes for a more thoughtful addition.

Once this Christmas season is over, it is time to start shopping for the next year. Snider said some of the best deals on gifts, wrapping paper and decorations can be found during the post-holiday sales. So once again, the more you plan, the more you save.