Saving During the Holidays

Gift giving doesn’t have to empty your wallet if you follow these tips:

Pay cash. If you decide in advance how much you want to spend, and leave the house with that amount in your pocket, there’s no way you can overspend. Leave your plastic at home.

Avoid credit card sign-up “discounts.” Offers of a 10 percent or 20 percent discount on your purchase if you open a store credit card account are common. Store credit cards often carry very high interest rates. If you run up a large balance, you may find yourself paying off interest charges that are much higher than the initial “discount” you receive.

Look into layaway. In a layaway plan, you typically put down a percentage of the item’s total cost, then pay a little each week until you’ve covered the full price. At that point, the item is yours, and you don’t typically incur any interest cost.

Watch out for warranties. When you purchase some items, particularly electronics, salespeople often urge you to buy an extended warranty to cover repairs or replacements down the road. Before agreeing, find out the total cost of the warranty. A deal that costs a few dollars a month could end up costing you hundreds of dollars over time once you add it up.

Shop sales now. Once the holiday season is over, stores immediately discount all their seasonal merchandise, including gift wrap, greeting cards, decorations, and more. If you can comfortably afford it, shop after the holiday and pick up everything you need for next year at sale prices.

With 2011 just around the corner, several cutting-edge technologies have emerged to help consumers save and streamline their bill paying processes. Here are several:

Dynamics. With Dynamics, consumers only have to carry one credit card, but can decide which account they want to use.

StatementRewards. BillShrink’s service allows people to receive personalized bill analysis and loyalty merchant rewards within their bank statement. With StatementRewards, your bank statement can tell you if you are paying $75 more per month than you need to on your wireless bill.

Mitek. Mitek is working with major financial institutions to provide mobile check deposit to consumers. It’s easy: just snap a picture of your check with your smartphone. Mitek also has a new application called Mobile Photo Bill Pay in which users can pay their bills by snapping a picture of their bill using their smartphone.

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