USA TODAY International Edition

Give yourself gift that could keep on giving

Easy cuts to frivolous spending can prep for uncertain ’ 23

- Personal Finance

Many of us might not be ready to admit it, but the economy is likely to be touch- and- go in 2023. We’re already dealing with higher everyday expenses for food, gas and winter utility bills. Some are being hit by job cuts. Others are worried about sizable losses in their 401( k) s.

Why exactly do you want to be glaring at a pile of holiday- fueled credit card bills in late December or January? Seriously, is this really the year that the dog needs a new holiday sweater?

Lower- and middle- income consumers already feel the most pressure on their pocketbook­s, thanks to higher prices for everyday necessitie­s, according to experts at the National Retail Federation. They’re the most likely group to try to trim back spending where they can for the holidays.

The well- off are expected to pick up the slack.

How much do you spend on gifts?

On average, consumers are expected to spend around $ 832 each for holiday gifts and winter celebratio­ns, according to the National Retail Federation. That’s down slightly from $ 879 in 2021. Even so, holiday retail sales during November and December are expected to grow between 6% and 8% over 2021 to between $ 942.6 billion and $ 960.4 billion, according to the industry group. Last year’s holiday sales grew 13.5% over 2020.

“Higher income households are going to plan to spend significantly more, on average, on holiday gifts and seasonal items,” Matt Shay, the president and CEO of the National Retail Federation said in a press call in early November.

In general, he said, consumers are spending “more thoughtful­ly, a bit cautiously” and looking for discounts and ways to stretch their dollar. A strong labor market and built up savings, though, will enable many to keep spending this holiday.

Even so he noted: “Many households are going to supplement spending with savings and credit is going to provide a cushion.”

Again, is now really a good time to dip into savings – and take on more credit card debt – to cover a sackload of holiday gifts? Especially given the rising risks of a recession in 2023? University of Michigan economists Thursday said a mild recession is likely ahead in 2023, as the Federal Reserve continues to

raise interest rates to try to cool down inflation.

You can’t control what’s likely to happen to the country’s economy next year – or even what’s going to happen to your job – but you can put a lid on some holiday spending. Maybe, take a step back before you rush online or jump in the car to chase some of those big sales this holiday season.

Making Christmas less expensive

A good way to save money is to realize what can drive you to overspend in any season.

Some people are wired to pull out their wallets when they spot a “buy more, save more” deal. Or maybe oneday- only specials get you to overload the online cart.

Sometimes, we just spend way too much on cute – like new matching plaid pajamas for the entire family or clever T- shirts for $ 20.

Frivolous spending might provide some entertainm­ent value, but it’s one of the easiest places to cut back.

What does 50% off really mean?

Black Friday and Cyber Monday promotions are fueled by so- called big bargains. But it’s easy to lose focus – and money – if you only look at the half- off sign and don’t know the price on other days of the year.

“They believe the savings claims that retailers make. Save 20%. Save 80%. Save 50%. ‘ Oh, that’s a great deal,’ ” said Edgar Dworsky, a consumer advocate and founder of ConsumerWo­rld. org.

But if the item never really sells for that high so- called reference price, he said, then what kind of a sale is it really?

“You’ve got to be careful about list prices. Nobody pays list,” Dworsky said.

To really save money, review what an item has been selling for at various times. Know the difference between a bah humbug deal and a jolly one.

Pricing tools exist to help you out, including CamelCamel­Camel. com, which can be used to compare today’s price for an item to prices that had been charged for that same item over the past year at Amazon and other sellers.

If you’re buying a big ticket item, like a TV or maybe a mattress during a holiday sale, make sure to check out reviews that can tell you about the quality of the product, too.

Many times, Dworsky said, consumers rush to buy the item on sale – and then go home to read the reviews.

“You’ve got to do your homework in advance in terms of what’s a good price and what’s a good product,” he said.

Another resource: Fakespot. com can help protect you from scams that might rip you off and can be used to detect unreliable product reviews and some bad sellers online.

What is a reasonable gift budget?

When you’ve got to cut costs, you really do need to cross some people – and pets – off your list.

Make Your Own “Naughty or Nice” list to clarify who you want to give a gift to this year and who maybe isn’t going to make the cut, suggested Terrence Daryl Shulman, founder and director of The Shulman Center for Compulsive Theft, Spending and Hoarding in Franklin.

Shulman and his wife spend about $ 100 each to cover gifts for a group of family members and best friends. Typically, it’s about $ 20 a gift. Maybe $ 20 can be used to buy an Amazon gift card, a winter hat or gloves, a good book or board game, beer or wine, or a discounted Groupon for a manicure. Or maybe an ornament for the tree or a menorah. Or a fancy sweet treat from a local bakery.

His family shops early and wisely by using coupons and looking for deals. They also buy less expensive but more personaliz­ed gifts.

Some holiday shoppers spend far more, maybe $ 50 or $ 100 on each gift. Trimming the list can really add up to meaningful savings.

Instead of exchanging gifts with friends, maybe take time to be with each other. Go for a walk. Volunteer as a group during the holidays at a soup kitchen or animal shelter. Or have a modest get- together, watching a movie and sharing snacks or a potluck.

Plan for the unexpected

Kathryn Ellywicz doesn’t just make a list of who will get a gift. She also writes down how much she’s going to spend on each person and what she’s going to buy. Sticking to the list, she says, helps avoid those impulse buys that really add up. Gifts for nieces and nephews are around $ 30 each; the adults draw names to buy a gift for one person and those gifts run about $ 50.

It’s also important to think ahead about events that can trigger more spending, said Ellywicz, a marketing and communicat­ions specialist and former counselor at GreenPath, a nonprofit credit counseling agency.

The dollars spent on the holidays can increase for all sorts of reasons. Someone suddenly asks you to bring an appetizer to a party. A friend really wants to go to a Broadway show that’s coming to town. There’s a holiday fundraiser at work or your place of worship.

“We do see people spending more than expected,” Ellywicz said. “It can be a shock sometimes what that holiday spending bill is.”

GreenPath, she says, does see an increase in calls in January when people get their credit card bills.

She suggests finding less expensive substitute­s. This year, she’s making plans to go to a tree lighting ceremony, for example, with someone she often goes out to dinner with around the holidays. They’ll spend far less money but still create fun memories. Less expensive experience­s, she said, can replace costly gifts, too.

Budget now for big 2023 expenses

Many bills that aren’t related to the holidays will hit in January. Right now, millions of people with college loans are expected to have to resume their payments in January after a nearly threeyear hiatus.

Heating bills could spike by 33% or more this winter for those in Michigan who heat their homes with natural gas.

Now is a good time to think about where you can cut expenses or increase income to plan for next year, Ellywicz said.

While we’re hearing about layoffs at big companies, like Amazon, she said, many job openings exist at retailers, restaurant­s and food delivery services.

“Seasonal work is still out there,” Ellywicz said.

Secondhand celebratio­n

We’re looking at a new national shopping holiday dubbed “Secondhand Sunday,” which is celebrated the Sunday after Thanksgivi­ng. It follows two big shopping holidays, Black Friday and Small Business Saturday, and it is the day before Cyber Monday.

Not surprising­ly, the new day was pushed onto the calendar by Poshmark, which runs a social marketplac­e for selling new and used fashionabl­e goods for women, men, kids, pets and the home. Poshmark calls it a “day dedicated to supporting secondhand sellers, circular fashion, and the planet.”

One goal is to highlight the environmen­tal and economic benefits of reusing items. Some call it “sustainabl­e shopping.”

Seems to fit nicely into a “Let’s Don’t Go Broke” holiday theme.

Maybe you’ve got plenty of secondhand treasures to gift that are sitting in your own closet, cabinet, or jewelry box.

Families who are looking to save money on holiday gifts could consider a new rule this year that all stocking stuffers must be items that you’re regifting or sharing secondhand.

We enjoyed a family party once where everyone was asked to bring a wrapped gift that they really didn’t want, a regifted item, that the guests could trade among themselves as part of a white elephant or Dirty Santa gift exchange. You do need a dollar limit − and a few other ground rules.

I know a young couple created a family rule that they only give used gifts. The family discovered that the strategy saved money and cut a lot of stress.

If you play one of these games, though, pay attention to what you’re giving. You don’t want to wrap something as a gift and then hand it to the person who gave it to you last year.

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 ?? GETTY IMAGES ?? Columnist Susan Tompor asks, “Seriously, is this really the year that the dog needs a new holiday sweater?”
GETTY IMAGES Columnist Susan Tompor asks, “Seriously, is this really the year that the dog needs a new holiday sweater?”

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