If Bing Crosby was around today, he might be singing, "I'll Be Broke for Christmas." A recession is not exactly the cheeriest time in which to celebrate the holidays.
A report by the International Council of Shopping Centers, or ICSC, found that year-over-year sales at U.S. retail chains fell 0.9 percent in October, and predicted an abysmal holiday shopping season. "ICSC Research is now paring its holiday forecast to the low end of our forecast range," said Michael P. Niemira, ICSC chief economist and director of research.
There's no doubt that many Americans will be looking at drastically reduced holiday budgets -- and for gifts that are more practical and affordable than the iPhones and Wiis of yesteryear.
"I think people are re-evaluating their spending and credit usage over the holidays," says Jennifer Melnick Carota, author The Gift Therapist blog and the book "Shop Smart Give More." "They're basically riding out the storm."
But take heart. Just because you won't be blowing a Santa bag full of cash doesn't mean that Christmas has to be a dreary affair. "I'm confident that the current economic situation will not adversely affect the giving season," says Carota. "People will become more creative and frugal with their giving dollars."
In that spirit, here are 12 recession-proof ways to use your ingenuity and know-how to boot the bad-economy Grinch out of your holidays and spread some serious holiday cheer.
12 gifts that won't break the bank
1. Movies. A lot of people on your list may be feeling the pinch when it comes to entertainment. Whether they've had to cut out premium channels or trips to the movie theater, giving them a little movie magic might be just the ticket. Two major online movie services, Netflix and Blockbuster, offer gift subscriptions that will keep recipients in movies for months.
Low-cost alternative: Head to Fandango.com and buy a gift certificate good at theaters across the country. "Experiential gifts, like movie passes or museum passes, will be big this season," says Carota.
2. Energy. That lump of coal you got for being on the naughty list might be looking pretty nice to you now after a year of inflated energy prices. Gas gift cards or an oil change will all help ease the pain at the pump this holiday season.
Low-cost alternative: A tire-pressure gauge as a stocking stuffer can help maintain peak fuel economy.
3. Coffee. As anyone who owns stock in Starbucks knows, a lot of people have been giving up their morning lattes to save cash. You can help your loved ones regain that "java de vivre" with a gift card to their favorite coffee shop. Or enable them to make a high-quality cup of joe at home with a coffee grinder or an espresso machine. A serviceable espresso machine from Mr. Coffee and other reputable brands costs $50 or less.
Low-cost alternative: A bag of tasty gourmet beans.
4. Food. Many Americans' diets have suffered as the price of good, fresh food has risen, both in restaurants and on the grocery-store shelves. For those who've cut back on dining out, a gift certificate to their favorite restaurant may be in order. Gift cards for restaurants are projected to be the top type of gift card this holiday season, according to a survey by the Archstone Consulting. For foodies and cooks on your list, a grocery-store gift card or a rockin' recipe book may be just the right holiday treat.
Low-cost alternative: A few of your own home-cooked specialties, either in the form of entrees or desserts, frozen and nicely packaged, will fill recipients with holiday cheer. "People are returning to basics like gifts from the kitchen," says Carota. "You can jazz them up by giving it to them in a new container or something practical that the hostess can keep."
5. The spa treatment. One of the first creature comforts to go when the budget axe comes down is that regular trip to the spa. "We're seeing a lot more weakness in more discretionary services like massages and facials -- things women view as maybe not necessarily essential and more of a luxury item," says Brad Masterson, public relations director for the Professional Beauty Association. Don't let your loved one go unpampered -- buck the trend and get her an hour at her favorite spa or a massage therapist.
Low-cost alternative: Gift certificates for manicures and pedicures make perfect, inexpensive presents.
6. Financial peace of mind. Help take the edge off the anxiety about today's wildly oscillating financial markets with a paid appointment to a fee-only financial planner. Making a plan for how to deal with today's financial challenges will help your loved one stop worrying and enjoy the holidays.
Low-cost alternative: A classic personal finance primer like "The Total Money Makeover" by Dave Ramsey can help put the recipient on a road to financial well-being.