Plan now to make holidays debt-free

NEW YORK — For consumers grappling with job insecurity and limited credit, it will be especially important to keep holiday spending in hand this year. To avoid making bad choices or buying in a panic two days before Christmas, the key is to start planning now.

“If you plan and figure out how much money you have, it won’t be stressful,” says Sandy Shore, senior counselor for Novadebt, a nonprofit New Jersey-based credit counseling agency.

Here are some tips:

Set limits

Job One is to figure out how much money you can afford to spend in all. Next, list people you’ll shop for and set a spending limit for each with some specific ideas of what gifts you’d like to procure. To avoid racking up debt, pay with cash or a debit card or even set up a special bank account — though experts caution against using traditional Christmas Club accounts if they have lots of restrictions.

Shop strategically

To find the best deals, from computers to toys, register to receive e-mail alerts on price cuts. Sites like Shopzilla.com, Shopping.com and Pricegrabber.com have information on a wide range of goods. Shopittome.com looks for deals on brand-name clothing and accessories and e-mails shoppers customized daily or weekly summaries. And Groupon.com tailors deals to a given region based on interest expressed by members of the site.

Timing is everything

Daniel de Grandpre, editor-in-chief of Dealnews.com, says the day after Thanksgiving, traditionally the shopping season’s kickoff, isn’t necessarily the best day to find bargains. In recent years, stores have offered deals throughout November similar to their promotions during that ballyhooed pre-dawn bonanza, while de Grandpre says the best time to buy toys is two weeks before Christmas. That’s when stores start ratcheting up discounts, sometimes to 80 percent, particularly on more obscure toys and those not selling fast. Of course, if you want this year’s must-have, you should start looking now or risk finding yourself in a bidding war.

Think about reuse

Refurbished goods that look new are great for the gadget-seekers on your list. Michelle Madhok, founder of online publications Shefinds.com and Momfinds.com, points to sites like Apple.com and Dell Inc.’s Delloutlet.com. Both offer the same warrantees on used items as on new products, and some of their “refurbished” products were simply returned by customers unused. Dell spokesman Bob Kaufman says discounts range to 20 percent.

Also check Nobetterdeal.com, which sells returned items for 40 percent to 70 percent off the retail price. And remember that Amazon.com will connect its customers with used books, DVDs and other items being sold by other retailers and by consumers. Craiglist.com can also be a great source. Whenever buying anything used, be sure you know its condition before you pay.

Consider cash back

Many credit cards and retailers reward shoppers with points or even cash, though experts advise checking for fees or limits on how you can spend the payments.

Wells Fargo’s card services division simply gives back 1 percent of a cardholder’s monthly purchases. When Bank of America credit card holders shop online with about 300 specific retailers, they get up to 20 percent back on top of any discounts retailers offer. And 1800flowers.com gives participants a $20 gift certificate for every $200 they spend.

Many other cards and stores offer similar programs. But Jim Roberts, professor of marketing at Baylor University, warns that such programs can trap consumers and recommends using them to buy only what you need, just as you should respond to any sale or promotion.

“Don’t just spend to save.”