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Shop for Christmas without going into debt

December 2, 2011
By MIKE HUGHES - Times Leader Staff Writer , Times Leader

IN A PERFECT world, when it came time to do the Christmas shopping, everyone would have more than enough money to make one large trip and that would be it.

Gifts would be bought for everyone and each gift would be exactly what was asked for. When money is no object, that goal is attainable. But for the majority of Americans, that is not their reality.

Not everyone can whip out the old gold card and go wild.

So for the rest of us, there are a few options you can take.

The best option for those with tighter budgets is to begin saving in early January with a dedicated savings account, building up in smaller increments before its ready to be withdrawn in November or December.

Not everyone is disciplined enough to do that. And for those that are, there's always the chance an emergency will arrise car issues, the washer breaks, etc. and you have to tap into that money to clear the emergency.

Christmas Club/Christmas Savings Account

In those instances, the best thing to do is to check with your employer or financial institution of choice to see if they offer a Christmas Club or Christmas Savings Account.

These function similar to a general savings account in that you put money in each month or pay in hopes of building a nice chunk of change come shopping time.

For Christmas Clubs at work, the money is deposited before receive your final net pay and a running tally of how much you've saved is shown on your pay stub.

For banks, the easiest method is to have your check direct deposited and a portion you designate will be set aside in the Christmas account.

What makes these convenient is that you are unable to withdraw any money from the account until a set date, generally closer to the Christmas shopping season.

While these accounts can't force you to spend money on presents, they do insure that there is money available to do your shopping.

Christmas Layaway

Another great option which has made a huge comeback in recent years is layaway.

The premise is simple.

Larger retail stores allow you to go shopping early, pick out all of the presents you want and instead of having to foot the entire bill all at once, you pay it off in increments until the balance is zero.

They hold onto the gifts for you, hence the "layaway" until the bill is squared away and then you can take all of the gifts home.

There is generally a minimal fee, $5 or $10, to participate in the layaway and you must pay anywhere from 5-20 percent of the total bill of sale up front as a deposit. From there, you have, on average, around eight weeks or so to pay off the layaway.

Most of the retailers will print out a payment schedule right on your receipt, listing the minimum payment every two weeks that must be made.

The big advantage to layaway programs, aside from the payment plan, is that you can shop early, when there are still good toys and gifts on the shelves.

Some people start saving late and go shopping at the last minute. For those folks, the pickings are generally slim on the shelves that final week of Christmas. Layaway programs help avoid this dilemma.

The drawback is if you forget to pay your bill on time. If you fail to meet the payment obligations, you lose the money you've paid and the gifts you were hoping to bring home.

Shopping year round

A twist to holiday shopping is to be on the hunt for Christmastime-items year round. This can work well for both adults and kids.

Instead of waiting until the last minute to buy gifts, you can start as early as a few days after Christmas, buying one gift at a time here and there as you go throughout the year.

The advantages are you don't have a giant bill to pay off at the end of the year and you don't have to fight the increasingly maddening hoard of shoppers as the minutes tick closer to Christmas Eve.

The drawbacks? If you have adventurous children who spend any amount of time at home alone, there is a good chance they will go gift hunting at some point. And the older they get, the harder it is the hide the gifts. If you have a great hiding spot that you know they'll never find, use it. If not, save the gifts at a relative's house until the big day gets closer.

Big gift vs. multiple gifts

There are a few schools of thought when it comes to gift buying for your kids.

But when you're looking at stretching your holiday budget, here's an idea to ponder upon.

What would be better for your kids, one big gift they really want or crowding the tree with a legion of smaller toys?

If there's that one must-have item they've been bugging you about, say a giant dollhouse, a bike, an X-Box 360 or PS3 for the older kids, go ahead and get it. Maybe get one or two accessory items to go with it and call it a day. Are they expensive, yes. But instead of immediately dismissing the gift as too expensive, weigh what it costs compared to buying multitudes of smaller gifts, most of which will be cast aside in a week or two after the newness wears off.

Whether you buy two gifts or 200, if you find that one thing your child really wants, they won't care if it's the only thing under the tree.

Hughes may be reached at



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