Say Bye-Bye to Buy-Buy Holiday Messages

With the economy still struggling, now is not the time to rack up new consumer debt.

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As the holiday season picks up steam, so do the roaring commercial voices calling on us to consume. And what they're saying is that the economy is recovering, the recession is over, and it's time to open up our wallets, melt our credit cards, and get back into America's national pastime—conspicuous consumption. I am no Scrooge but, please, resist the siren calls of financial irresponsibility.

[See Best Affordable Places to Retire.] You'll remember that Congress enacted curbs on credit card companies but the effective date was a long way off. The companies were so aggressive in tightening the screws on consumers in the meantime that Congress hurriedly stepped in and moved up the effective date of the legislation. I don't know about you, but these days I read all the notices from my credit card companies that I used to throw away. So, first off, I'm not so happy that I have to spend the time reading all those fine-print notices. Second, I'm definitely not happy reading about how the companies are raising rates during these tough times. That's doubly upsetting when the government has been trying to jump-start the economy by reducing the cost of borrowed money to nearly zero. My latest missive informs me that the variable interest rate on one of my cards will be raised—should I be so unlucky as to breathe at any time during the billing statement period—to the prime lending rate plus only 15.99 percent. Have a nice day!

Still, I know these companies value our relationship, because they constantly tell me so. And when I'm not reading their notices, it seems I'm opening their holiday offers that contain personalized checks that I can write against my credit card account. Good as cash! Woohoo! If you care about treating your loved ones properly at this time of year, it seems, you are obligated to spend money you don't have, and then to pay it back at interest rates that bear no relationship to the current cost of money. What these exorbitant charges do relate to, however, are the costs that card companies are absorbing—expenses stemming from account delinquencies caused by all those people who couldn't afford to use the cards two and three years ago.

I'd humbly suggest that the best holiday gift a family can have is to be as free of debt as possible, and that emerging from this Christmas season with no added consumer debt is a sign of true love, not the opposite.

Still, you can sense that people would like to spend money again and not worry so much about the consequences. We have been a consumption-driven society for a long time. Such impulses die hard, especially during the "buy now" commercial bombardment of the holidays.

[See Best Places to Retire.] These ads are presented as uplifting, "feel good" commercial vignettes. And they're not limited to holiday gifts. There's a current ad campaign, for example, from Volkswagen. It emphasizes the ease of purchasing a qualifying VW vehicle with a tout that all you need to do is sign on the dotted line, and then drive away into what surely will be an even more successful life than the one you currently lead (VWs are, of course, not purchased or driven by unsuccessful people). Then the ad hits you with the three zeroes—$0 due at signing, $0 down payment, and $0 first-month's payment.

Sharyn Lowry, a retired healthcare office administrator in Richmond, Va., was telling me about the ways she has tried to cope with the financial messes of 2008 and 2009. She thinks things are finally getting a bit better, but she also hopes her 1992 Acura continues to plug away for many more years. And that she stays healthy. And that the market's recovery continues to help revive her depleted IRA. Living on a fixed budget and facing a 30 percent hike in premiums for her Medicare Advantage policy, Ms. Lowry knows we're not out of the woods by a long shot. Accordingly, she worries that people are being wooed back into old spending habits. "I was horrified when I saw that ad on television form Volkswagen, where they said you can drive away with just your signature, " she says. "Haven’t they learned anything?"

Maybe not, but I hope we have.

Shop responsibly this holiday season. You will have a better 2010 if you do.

[See 6 Steps to a Better Retirement.]