financial crisis shopping, budget shopping, home economics
Marcio Jose Sanchez/AP
Shoppers ride an escalator at Macy's in San Francisco, Friday, Nov. 21, 2008.

Are Americans Really Cutting Back This Holiday Season?

November 27, 2008 12:58 PM
by Sarah Amandolare
On the surface Americans seem to be making more frugal decisions, but a closer look reveals a society perplexed by the concept of budgeting.

Trading Luxury for Excess

A recent article in The New York Times highlights the difficulties Americans have with making fundamental changes to their lifestyles to counteract financial setbacks. For instance, although people are perhaps more careful about which grocery store items they purchase, many are also joining discount stores and “over-purchasing ‘bargains,’” says Leslie McKee, a Pittsburgh-based family manager.

Other experts observe a range of behaviors; some Americans obsess over every last penny, while others feel so entrenched in debt that they are spending even more than they were before the crisis. Others “are attempting to save money by spending it,” for example, buying expensive heating appliances in an effort to cut back on home fuel costs, reported The New York Times.

Much has been made recently of Americans’ budgeting efforts. In Tacoma, Wash., parents are enrolling their children in classes focused on “rudimentary but real-life-like choices about how to spend, save and share money,” reported The News Tribune. The class also helps parents explain to their children their spending habit changes—why they’ve bought generic cereal or don’t go out to dinner as much, for example.

Fashion mavens are also heading to consignment stores more often, and learning to find items at lower prices, according to the Chattanooga Times Free Press. And home cooks are learning to make do with dollar-store items that can be creatively spun into gourmet meals, reports the Concord Monitor.

But are Americans simply buying more stuff from less luxurious retailers, and in the process spending the same amount? To really change one’s spending habits, the EconoWhiner blog suggests making one significant lifestyle change, such as forgoing dinners out. “Make one painful choice right away,” says the EconoWhiner, and things will snowball from there.

Background: Budget retailer or spending enabler?

CNN reported that retail giant Wal-Mart was revealing its “Black Friday deals” on Nov. 24, as American shoppers on budgets are “likely to turn to discounters” this holiday season. Wal-Mart is promoting high-tech items, such as “flat screen TVs, Blu-ray players, Xbox 360 consoles and home computers,” none of which are especially budget-friendly in the first place.

Related Topic: Saving and planning

The findingDulcinea article “6 Sites to Save Shoppers Money” offers bargain-hunting advice for Web shoppers. And for financial planning guidance, findingDulcinea provides “5 Essential Financial Planning Sites.”

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