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AUSTIN, TX -- With the holiday shopping barrage about to descend upon us, the old-time adage of "buyer beware" may yet be the best advice for shoppers bombarded with a bewildering array of product choices and advertising blitzes.
A combination of low inflation and a strong economy in 1998 has many retailers anticipating hefty sales volumes. As online shopping continues to gain favor with a growing number of Americans, the buying choices continue to multiply. And so do the opportunities for many consumers to enter the new year wondering how their debt balances got so out of control.
"Staying on budget and resisting the urge to buy impulsively is one of the best gifts you can give your loved ones this holiday season," says Rob Schneider, a senior policy analyst with the Southwest Regional Office of Consumers Union. "By planning ahead, you can ensure you're not saddled with additional, unplanned debt when the party's over."
To help with the busiest shopping days of the year, Consumers Union offers the following tips:
Be careful with how you pay
Extended warranties usually are a poor buy
Stores often push extended warranties on their products, but these usually are not a good deal for consumers. Fewer than 20 percent of products covered by an extended warranty are ever brought in for repair. According to a May 1998 Consumer Reports survey, readers who bought extended warranties had paid about as much for those warranties as the average repair costs for each item. Instead, pay the extra money for a high quality product or set aside a repair fund. Sometimes credit cards automatically include extended warranties, but be sure you read the fine print. However, you may want to consider an extended warranty for certain high tech products subject to frequent use like home computers.
Shopping on-line is not for everyone
Purchasing products from catalogs or over the Internet has many advantages: it cuts off time spent traveling from store to store, business hours are more flexible or even 24 hours a day, and many businesses have a better selection of items compared to your local mall. If you are new to on-line shopping, it is wise to start with a small purchase such as a book or CD. Also, shop with someone you know and trust and make sure the seller has a good privacy policy.
If security remains a concern, you can still comparison shop on-line and then make your purchase in person.
Know the return policy before buying
Always save your receipts or other proof of purchase, and ask the retailer what their return policy is before you buy. If the product doesn't work as advertised, promptly take it back and ask for a refund or replacement. If you are still dissatisfied, contact the seller or manufacturer in writing. Be polite but persistent in pursuing your complaint. If you are not satisfied, complain in writing to the Texas Attorney General's office.
Consider alternatives to buying
In response to the shopping craze that occurs every year, on the day after Thanksgiving a Buy Nothing Day has been started to encourage people to stop and reflect on the holiday excesses. Instead of shopping, you can plan to spend the day with family and anticipate any groceries or other needs ahead of time. Also, as the malls get more and more crowded, consider alternative gifts. For example, a charitable contribution made in the recipient's name can be an ideal gift that exemplifies the true spirit of the holiday season. And don't forget too that sometimes the best gifts are homemade ones.
Seek help if debt becomes a problem
If you have trouble with your debts, contact the nonprofit Consumer Credit Counseling Service in your area to help you budget and to negotiate a payment plan with your creditors. Call 1-800-777-7526 (777-PLAN) for a local listing.
Said CU's Schneider: "Shoppers are particularly vulnerable during the holiday season and merchants know it. It all boils down to common sense. It is up to each consumer to be informed and protect their hard earned money."
