DIANE MAKAR MURPHY Keep holiday costs down -- and still enjoy giving

My dad is glib about outsmarting credit-card companies. He never paid a dime of credit-card interest in his 82 years. If he used a credit card, he already had the money in the bank to pay it off.
"A free loan," he would chuckle, as he taught me to do the same.
I have followed in his footsteps.
Not so for many consumers, and the holiday season may just add more debt to an already bulging card. The average American family, a Senate subcommittee noted last year, carried $8,123 in credit-card debt -- this with double-digit interest in most cases. If you paid that back with the minimum amount at 18 percent interest, it would take half a century to do it.
A survey last year found that for Christmas 2002, consumers expected to shell out an average of $649 on gifts and seasonal goodies. The surveyors predicted the amounts were underestimated. Realistically, it would be more like $1,100 in credit-card charges by the time Santa had dropped through the chimney. It would take, on average, four months to pay down that amount. Many shoppers would pay the cost of their purchases plus 20 percent above that in interest payments.
Credit counseling
Nancy Gray, Northeast Ohio regional director of the Consumer Credit counseling Service in Warren, is well acquainted with the problem. She has been with the nonprofit service for 22 years.
"We used to get a lot of people seeking help in January and February, but now it seems more constant," she said.
This isn't necessarily a negative.
"People seem to be addressing the problem sooner these days," Gray said.
The national average of consumer debt this year is about $9,000, according to Gray. This includes credit-card debt, medical bills, debt to collection agencies and any other unsecured debts; cars and houses aren't included in the figures.
Credit Counseling Services has been in Warren since 1977. It also has offices in Youngstown, Boardman, Hermitage, Pa., and Grove City, Pa. They accept a donation for their services but do not require one.
"We assist a client in assessing his or her debt and creating a budget," Gray explained. "Then, we work with what is left over to pay off creditors."
Controlling spending
Gray has suggestions for keeping a rein on the budget this holiday season. (If you need additional guidance, you can call Gray at (330) 399-2275.)
UDevelop a spending plan. Besides gifts, remember to include costs of gift-wrapping, cards and postage, travel and food.
UMake a gift list, and stick to it! Stop when you have completed the list.
USet a spending limit for each person.
UConsider a gift exchange.
UWatch for sales -- check the ads.
UPay cash when you can, and use lay-away when necessary.
UUse credit cards responsibly.
UConsider a Christmas Club account (for next year).
UCreate time for shopping. If you are stressed out, you may buy impulsively.
UMake holiday gifts. Freshly baked breads, cookies and desserts are always great.
UInstead of giving money to younger children, consider U.S. Savings Bonds. They bear interest and cost less than the face value.
UAt holiday functions where you are expected to provide a gift, suggest instead of gifts, bringing canned food or other items for a local agency to help the disadvantaged.
URemember, we always spend more when writing checks and using credit cards instead of cash. Buy with cash as much as you can.
UA gift of "your time" to baby-sit, do repairs, cleaning, etc., is always appreciated.
URemember to have a wonderful holiday -- smile and enjoy the season.
As Gray said, "I remember when I was younger, we didn't have much, and we had wonderful holidays, didn't you?"
XThe paper is taking a vacation from my column next week. See you Dec. 2!