Consumer Payment Card News

Easing Holiday Pressure

The candy corn was barely off the shelves and the Plastic Halloween pumpkins relegated to the sale bins this year when the stores were festooned with Christmas adornments.

The pressure to shop — early and often — is on.

Shoppers expect to spend a total of $1,233 this holiday season, with an average of $879 being spent on gifts, according to the 1997 American Express Retail Index guide that polled more than 800 consumers. Overall holiday spending will be up 6 percent over last year, the poll also reveals.

American Express Financial Advisors, the financial planning arm of American Express, offers consumers some tips to survive the shopping sagas — and to help your budget emerge relatively unscathed:

— It sounds basic, but create a budget and stick with it. Many people set their budget and forget to plan for the “little things” outside the realm of gifts — wrapping paper, candles, cards and the costs of entertaining family and friends.

— Start early and do your shopping in spurts, considering two to three people on your list at a time. Shopping late can lead to panic and the risk of buying anything in sight, just to get the job done. By spacing out the task, you can ponder each person on your list personally and purchase a more meaningful gift — at a more realistic price.

— Think creatively. Some parents have won raves from their kids by devising homemade “coupons” that take the place of store-bought gifts. The coupons are tied to special activities, such as playing games with Mom, a visit from Dad to your child’s school for a special program or a day set aside for the child to learn how to be taught how to ride a bike or bake bread.

— Avoid the temptation to give in to the “buy-now-no-payment-until- February” enticements. Come February, a spate of fresh bills may not be a welcome sight. (And there’s always Valentine’s Day to think about.)

— Check out the consignment shops — now a trendy passion for many Americans. You may find that otherwise expensive designer sweater, jacket, purse or scarf for just the right person who appreciates a value.

— Hate crowds? Try cruising the “information superhighway.” According to the American Express consumer poll, some 6 percent of holiday shoppers expect to shop for gifts online, twice as many as last year.

— It’s becoming quite fashionable to be savvy about investing instead of “spending.” Some financial services companies are now packaging their products in ways that attract young investors. American Express Financial Advisors offers a mutual fund as part of its “Kids, Parents and Money” program that teaches kids and parents about saving and the stock market. The minimum $50 per month investment in this savings vehicle that invests in “kid friendly” companies like McDonald’s and Disney may be a great gift from parents and/or grandparents.

— Procrastination may not be all bad. Under the right circumstances, such as when extended family members don’t get together until after the holidays, you could hit the stores for the post-holiday sales. In fact, according to the American Express poll, 36 percent of adults say they shop for gifts after the holiday to take advantage of sales or because they didn’t plan to see the recipient until after the holidays.

— Reward yourself. By taking advantage of credit card rebate and reward programs that offer points for travel and merchandise, you can add even more value to your holiday spending. And features such as Purchase Protection or Buyer’s Assurance through credit cards can protect your purchases against damage or theft and can extend the warranty. If you do decide to use credit cards, it’s always best to make more than the minimum payment each month.

American Express Financial Advisors is one of the largest financial planning and money management companies in the U.S. with assets owned or managed of more than $162 billion. Formerly known as IDS, the 103-year-old company offers a comprehensive range of financial services through more than 8,500 financial advisors nationwide.

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