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Despite reports of lower-than-expected retail sales, nearly one-third of Americans say that they spent more than they planned on holiday gifts this year, according to a new survey commissioned by the National Foundation for Consumer Credit (NFCC).

Eighty-two percent of these holiday overspenders exceeded their budgets by up to $500.

To help Americans recover from excessive holiday spending, credit counselors across the country are offering individualized fiscal fitness plans. “Our counselors are poised to help the financially over-extended through this post-holiday crunch,” said Mark Cole, executive vice president of the NFCC. “In 1996, a record one million Americans filed for bankruptcy. Our New Year’s resolution is to help America avoid a repeat performance in 1997.”

The National Foundation for Consumer Credit is a national network of over 1,200 local, non-profit organizations, most operating as Consumer Credit Counseling Service agencies (CCCS), that provides free or low cost consumer credit education and counseling to families and individuals.

A Shape-Up Plan

CCCS counselors advise clients that fiscal fitness requires long-term planning and commitment; they recommend the following:

Know what you owe. Track all spending – check, credit and ATM – in your checkbook register or a notebook.
Trim where possible. Make a list of monthly spending and match it against current income. Cut any expenses you can do without.
Pay more than minimum amounts against debts. The minimum payment may only cover the interest rate and fail to chip away at the debt. CCCS can help create a repayment plan that is manageable and begins to lighten your debt burden.
Do holiday shopping throughout the year. Take advantage of “after Christmas sales” to save on greeting cards, gift wrap and small gifts for next year. If you plan ahead and don’t shop last minute, you are less likely to exceed your budget.
Increase your income. If expenses exceed income, consider working overtime or taking an extra job to keep up. Baby-sitting and bartending are just a couple of ways to make extra money. Another benefit is that if you’re working more, you have less free time for spending.
Consider bankruptcy only as a last resort. CCCS can help you work with your creditors to repay your debts, leaving you with a stronger credit report.
The Facts on Bankruptcy
Holiday spending, on top of other debts, can push consumers towards bankruptcy. However, contrary to popular perception, bankruptcy does not wipe the credit slate clean nor does it provide consumers with a fresh start. Consider the following facts:

When you file for bankruptcy, it stays on your credit report for up to ten years.
You will have difficulty getting future credit such as mortgage loans.
Alimony, child support and most taxes survive bankruptcy and will be still be owed.
Bankruptcy can affect your ability to get a job, since many employers obtain a credit report when assessing job qualifications.
Where to Find More Help

The NFCC and CCCS offer a budget worksheet entitled Getting Fiscally Fit to help consumers detect the warning signs of financial trouble by evaluating spending and current debt. The worksheet is available through local offices. To find the nearest office, consumers can call the 24-hour referral line: 1-800-388-2227. Also, consumers can visit the NFCC website at for a copy of this and other worksheets, information on the available counseling services and more quick tips on budgeting to buy a home, go on vacation or shop for a car.

The National Foundation for Consumer Credit is partnering with Visa U.S.A. in sponsoring this educational campaign on financial management.

Opinion Research Corporation, located in Princeton, New Jersey, conducted an omnibus survey of consumers, from January 2 to 5, 1997. A total of 1,002 adults aged 18 and older were interviewed.

National Foundation for Consumer Credit Survey on Holiday Spending; Results Summary
Nearly one-third of Americans acknowledge overspending on gifts this holiday season by an average of $322.
Eighty-two percent of holiday overspenders reported exceeding their budgets by up to $500.
Men admitted going overbudget by an average of $339 while women claimed to have exceeded their budgets by $305.
Twenty-four percent of those who have holiday bills reportedly do not know when they will finish paying for their 1996 holiday shopping.
Respondents without children under 18 in their households went overbudget by as much as those with children.

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