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Open House

How to Celebrate Stress-Free Without Going into Major Debt; Gift Cards May Not Be the Gift to Give This Season; Scaling Back on Gifts; How to Keep Your Holiday Green

Aired December 20, 2008 - 09:30   ET

THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.

GERRI WILLIS, CNN HOST: Hello, I'm Gerri Willis and this is OPEN HOUSE, the show that saves you money. And who wouldn't want to save money this year? We have tips and tricks that will let you celebrate stress-free without going into major debt. Plus, everything you need to know about gift cards and why they may not be the gift to give this holiday season.
But first, nearly 70 percent of people plan to scale back this year on gift giving, that according to "Consumer Reports'" annual holiday poll. With the economy in shamble, that's not a big surprise, but can you be fruggle and festive? Our first guest says yes, it's OK to be a tightwad. Bruce Weinstein is the Ethics Guy and a columnist for "Business Week."

OK, I feel so guilty because I can't spend what I did last year for gifts. And it's just -- it makes you feel bad inside, but the economy is so bad. Do you think people still expect the same gifts they had last year?

BRUCE WEINSTEIN, THE ETHICS GUY: Gerri, you have to reason to feel guilty for spending money you don't have. In fact, it would be unethical to run up debt just to make other people feel good. I mean, very few of us have the money now that we did last year.

WILLIS: That's absolutely right.

WEINSTEIN: In fact, there are other ways of letting people know that we care besides spending money.

WILLIS: Yeah, absolutely. You can give gifts that you make, et cetera. But, how do I choose who to give to? Because part of the problem is, your list can be this long, your list can be that long. Right?

WEINSTEIN: Imagine the series of concentric circles and you are at the center, and at the next level are your friends and family, and then your co-workers and then total strangers.

WILLIS: Sort of, order of importance, right?

WEINSTEIN: Exactly. Because, we have to rank order our priorities. And it would be wonderful if we could be all things to everyone at all times, but we can't, so we have to choose to whom we give our scarce resources, and the people closest to us have a greater claim on those resources. WILLIS: So, friends and family first and then you can start thinking about other people.

WEINSTEIN: That's right.

WILLIS: One of my favorite things to do around holiday times, and this is probably terrible. I re-gift things, if there's a bottle of wine or champagne at my house, it's going to somebody else.

WEINSTEIN: Again, no reason to feel guilty, in fact it's ethical to re-gift, because it is wrong to be wasteful. And if you get a sweater you're not going to use or you already have the "Boxcar Willie" boxed set of CDs, it would be wrong to keep it when someone else could benefit from it.

WILLIS: All right, another big issue for folks this year, I know is tipping. You know, this is different in different parts of the country. Some people it happens a lot, some places not so much, but at the end of the day for most folks out there, who do you tip, who do you not tip? Can I pull in this year and do less?

WEINSTEIN: It's OK to pull in now, the people at the front lines of the economy, like the doormen and the dog walker.

WILLIS: That's New York, I know. It's very, you know, not everybody has that.

WEINSTEIN: Babysitters, people who provide services year round who depend on tips, those are the last people who should suffer. But if you're not in the position to give the money you did last year, there's no reason to apologize. And there are other ways that you can make up what you're not able to provide financially. You can provide a service for folks. You can write a letter to their boss.

I mean, I'll bet you can't remember three gifts that you got last Christmas, but if I wrote you a personal heartfelt letter telling you how wonderful and what a great contribution you make to the world, you would remember that for years.

WILLIS: Well, you know, maybe so. I'm sure that is true, some people would rather have the gift, but the reality of what you're saying that you can do other things for people that fill some gap in their lives, whether it's a nice letter to their boss or something else.

WEINSTEIN: Exactly, the point is to express your gratitude and that doesn't necessarily have to take the form of giving money or gifts.

WILLIS: So, what else do you suggest if you're going to do something that is not the routine? What would you say would be a good idea?

WEINSTEIN: How about spending time with someone? How about tutoring their kids in the language that you're able to speak or helping them with their homework or something that will be beneficial -- in fact, you can ask your helpers how can I help you out? How can I make a difference in your life? And you'll be surprised how often people can tell you can help them.

WILLIS: Now Bruce, I want you to explain to people, one more time, here, because I don't think it's easy and it's not the first thing that people would think of that there's the ethical obligation not to overspend.

WEINSTEIN: That's right. We have an ethical obligation, first to ourselves, and then to other people. And it's unfair to ourselves and to our family members to run up debt just to make other people happy. So there is no reason to feel guilty for pulling back if you don't have money. You shouldn't spend money you don't have.

WILLIS: Shouldn't spend money you don't have. I think a lot of people wished they had heard that a couple of years ago. Bruce, thank you for that, we really appreciate your time, today.

WEINSTEIN: You're welcome.

WILLIS: Another way to stretch your dollar and help your bottom line this holiday season is not to spend anything at all, but that doesn't mean you're off the hook. The art of the homemade gift, it's coming back.

CNN's Kate Bolduan has the story.

(BEGIN VIDEOTAPE)

KATE BOLDUAN, CNN CORRESPONDENT (voice over): 'Tis the season to be shopping or not.

UNIDENTIFIED MALE: It's the fun of making things. At least for me.

UNIDENTIFIED FEMALE: I think that's a wonderful thing. I think we're going back to what they did many, many years ago. People have to be creative. I think it's a great idea.

UNIDENTIFIED FEMALE: So you just wrap it around...

BOLDUAN: Facing the demands of holiday gift giving and the pinch of shrinking budgets, many shoppers are buying less and making more.

UNIDENTIFIED FEMALE: I have six nieces and nephews and two brothers. So it's just -- it makes more sense just to make it myself because it could be cheaper.

BOLDUAN: With near limitless options ranging from ornaments and picture frames to baked goods and olive oils, homemade gifts may once again be a hot holiday trend.

ANGIE LESS, ASST. CULINARY COORDINATOR: We do see a lot of people are turning back to the kitchen as a source of holiday gifts. Everything from cookies to homemade breads, anything home and cooking related, we're seeing a lot of that. BOLDUAN: In a recent survey commissioned by arts and crafts giant Michael's stores, more than half of the respondents said they're more likely to make gifts this year than last. Meanwhile, retailers continue to slash prices, but experts say, holiday retail sales could see the slowest growth in more than 17 years.

ELLEN DAVIS, NATL. RETAIL FEDERATION: They know it's going to be tough. They're expecting meager gains, if any, and they know it's going to take a lot to bring people into stores and get them to buy.

BOLDUAN: And while homemade isn't for everyone...

UNIDENTIFIED FEMALE: I don't do any crafts, because I don't have the patience for that.

BOLDUAN: Tough economic times may mean good old creativity is making a big comeback this holiday season.

Kate Bolduan, CNN, Arlington, Virginia.

(END VIDEOTAPE)

WILLIS: Love those homemade gifts.

Well, gift cards use to be a very nice way and a simple one to give during the holidays. Why you might want to avoid gift cards at all costs this holiday season.

(COMMERCIAL BREAK)

WILLIS: You might want to think twice before buying a gift card for somebody this holiday season. With so many retailers closing shop in this rough economy, that business could be out of business even before the gift card is redeemed. Todd Marks is a senior editor with "Consumer Reports."

OK, Todd, tell me, should I just avoid it altogether this year? No, no, none of these cards, right, I mean, too many problems?

TODD MARKS, CONSUMER REPORTS: Well, the reality is that gift cards are one of the most popular gifts to give and to receive. People want them, they like them. There are a lot of issues with gift cards and you mentioned a key one, bankruptcies. Many, many companies are either in bankruptcy or on the brink and you never know. Once a company goes belly-up or files for Chapter 11 bankruptcy protection, these cards could ultimately become worthless and you could end up online as a creditor and with that company in bankruptcy court, because...

WILLIS: And we know how much money you get for that.

MARKS: Oh, if you're lucky, you get pennies on the dollar a few years down the road, because you're on a long list of creditors. And believe it, the consumer's not at the front of that line.

WILLIS: Well, OK. So, you know, even so, we're expected to spend some $94 billion on gift cards this year. What would you tell folks? What's the checklist of things to think about if you're going to buy one of these?

MARKS: Well, if you're going to buy a gift card, one, make sure it's to a store that's going to be in business. Now, there are no ironclad guarantees, but you can check out the Better Business Bureau, you can find out if there are any complaints about it, have there been issues about redeeming cards, getting refunds or exchanges.

So, you want to make sure they're solvent. You also want to make sure that the person on your list is going to use that card. Did you know that one out of 4 people who got a gift card last year didn't spend it yet? They didn't use it, they couldn't find anything they want...

WILLIS: That's unbelievable, Todd.

MARKS: We do these holiday surveys every year. One out of 4 people haven't used it because it expired, the company went out of business, they couldn't find anything they want, or they lost it.

WILLIS: Unbelievable.

MARKS: Yeah, it's amazing. So, gift cards are not the panacea a lot of people think they are. But they're convenient and they're easy and they're popular.

WILLIS: I need to know, what are the terms and conditions I'm going to face? What do I need to know, here? Because there are some devils in these details.

MARKS: Sure, and the devil is always in the details and with gift cards it's bingo, you know? When you're buying a gift card from a credit card company, such as an American express gift card or one from MasterCard, you have to be aware of the fact that they tend to come with strings and conditions. And expiration dates are first and foremost. If you don't use it by a certain time, it may be worthless. Second, they come with transaction fees, service fees, inactivity fees, dormancy fees, all of which can diminish the value.

WILLIS: This drives me crazy. This drives me crazy.

MARKS: Me too.

WILLIS: It can be bad enough, you know, for the person giving the gifts, but what if I'm getting the gift. What should I need know if I'm actually getting a gift card from somebody for Christmas?

MARKS: Spend it immediately. Don't wait, don't sit on it, don't put it in a desk, don't try to combine it with anything else. Go out to the store, especially with all of this talk about bankruptcies, the idea is that don't wait to find out if the card might not be worth something, go out there and spend it as quickly as possible, so you don't forget about it and you maximize the value.

WILLIS: I love spending it. That's the right answer there, Todd. Sounds like more trouble than it's worth.

MARKS: Most of the time it is.

WILLIS: Fantastic information, Todd Marks, thank you for that.

MARKS: My pleasure, Gerri.

WILLIS: Haven't finished your holiday shopping yet? Well, you've still got a little time and we've got plenty of great ideas for any budget.

(BEGIN VIDEOTAPE)

KARA FINNSTROM, CNN CORRESPONDENT: This holiday, there are presents you can give that won't take quite so much from the earth. And joining us now is Jessica Williamson, the environmental Web site, ZapRoot.

WILLIAMSON: And Jessica, you found some toys here that are not only cute, but these guys are eco friendly too.

JESSICA WILLIAMSON, ZAPROOT: They are. One of the things I wanted to talk about was handmade gifts. A lot of times (INAUDIBLE) IN a lot in a lot of ways.

FINNSTROM: Now, as a parent, myself, I'm really concerned with the materials that these are made from, too.

WILLIAMSON: Yeah, a lot of parents are this year. So over here, we have this cardboard dollhouse. You don't have to worry about the toxins because it's made from cardboard and not plastic. The other thing, took, is your kids can only going to use for 10 maybe 12 years, your child does not need this for 1,000 years and that's how long it takes for plastic to breakdown.

FINNSTROM: So, not only good for the environment, but good for your child.

WILLIAMSON: Exactly, exactly. Another thing that's not only good for the environment, but also good for you is biodegradable soaps and shampoos. People don't realize that each day we're exposed to over to 100 known carcinogens through chemicals and beauty products. You don't have to worry about pollutants and toxins getting into the ocean when it goes down your drain.

FINNSTROM: We've moved outside, into the warm sunshine for a look at a couple more gift ideas.

WILLIAMSON: OK, this is a Solio and it's a solar-powered handheld charger. And basically, you can charge any hand held device from your computer to your lap to your cell phone all by the sun. Another thing that's going to save your friends some money is this and it's called a KiloWise (ph), and what this does is you plug your appliance into this and then plug it into the wall and it will tell you how much money that appliance is costing you per month.

(END VIDEOTAPE)

(COMMERCIAL BREAK)

WILLIS: It's less than a week 'til Christmas, have you finished your shopping yet? Well, whether you've got two or 20 people left to buy for, our next guest has some last-minute gift ideas that won't break your budget. Who better to tell us, the best gifts then "Best Life" magazine deputy editor, Jack Otter.

Great to see you, jack.

JACK OTTER, BEST LIFE MAGAZINE: Great to be here, Gerri.

WILLIS: All right, you've got great stuff, here, I'm really excited.

OTTER: Me too.

WILLIS: I want to start with the sweaters, because these are fantastic. One of my favorite gifts is cashmere for Christmas. You've got some fabulous thoughts, here. Expensive?

OTTER: That's our thing, exactly: Women love cashmere. So, if you're a guy, you don't know what to get her, you cannot go wrong with cashmere. And the good news is don't tell her, these are $99.

WILLIS: Ninety-nine, that's a good price.

OTTER: Yeah, under $100 for a very, very nice fabric.

WILLIS: And I love the bright colors, it's all very festive and holiday, works for everybody, right? Now, you've got your BlackBerry, here. Did you have work you were going to do during the segment? Why do we have this, here?

OTTER: Finally, BlackBerry is close to perfect with the PDA. I've been waiting for this for a while. I don't like to carry 16 devices. I want a phone, I need a real live keyboard, it has a camera, so if you're out with the kids, you can take a picture. Here's what I love about it. OK, my trick is it's a recession gift, you get it for free. You could go buy it for $299.

WILLIS: It looks so expensive, and you get it for free?

OTTER: So, here's my thinking, you go to your IT guys. And you say, guys I know you're going to be upgrading the BlackBerry one of these days, the existing ones are going to be old, so talk to the Rim company, tell them, explain to the company's thinking about getting some new ones. This is how it works, Rim Stim's (ph), a company, a couple of them, they test them out and make sure it integrates with the corporate system and then they buy 10,000 of them for everybody.

WILLIS: And you get one free?

OTTER: No, no, no, the first one. You say I want to be the tester guy who gets the first one for free. WILLIS: And you get the first one?

OTTER: Exactly.

WILLIS: All right, what the heck is this? I've been looking at it, it's interesting on your -- you put it on your bike, but I don't know what it does.

OTTER: It's a GPS for your bicycle.

WILLIS: Excellent. I have been lost on my bicycle before.

OTTER: No, no longer with this.

WILLIS: How much does it cost?

OTTER: This one is bottom of the line, you can get it at Amazon for about $169. They go up to about $550, depending on how advanced you want to get.

WILLIS: I love that.

OTTER: With the advanced levels, you can upload the route to Bicycling.com, everyone does it. So, if you're going to a different state, you're traveling, hey, this is a cool site, the bicycling magazine editors have vetted it, elevation, everything.

WILLIS: That's fantastic. But, can I point out, though, I saw a magazine article that says this is sort of based on, there was jewelry on that and I think there was some perfume here and I'm not seeing it, here.

OTTER: That's what happens when you have a guy pick them out.

WILLIS: You're holding out on me.

OTTER: Yeah, I'm sorry about that.

WILLIS: OK, all right, next time. OK. We've got tennis rackets, here, which are fantastic. Why is one bigger than the other one?

OTTER: This is for sort of an intermediate player, that is for an advanced player. If we had the beginner player, it's the size of a walrus, it's huge. But this is intermediate, this is brand new technology, Gerri, these have never been on television, in a magazine, anywhere before.

WILLIS: All right. This is an awesome idea that doesn't cost much money. And you have put together a calendar of your family. This is so beautiful.

OTTER: This gets more oohs and ahs than anything else under the Christmas tree. It's 19.99. and this one I did on the Apple site because I think the quality of Apple's calendars are the best. I've used some other systems and I think this one is by far the best. WILLIS: So, you've tested a lot.

OTTER: Oh, I have, absolutely. And also, you need an Apple computer, which is the one downside if people don't have them. But, you actually do it on the computer and you do all your work on the computer, so you don't have that difficult thing of working on line and there is the pause and the this and the that. You put it all together on your computer and you hit a button to upload it and you're done. And if you open it up, you'll see on some of the dates -- all right, that one right there, you can drop the pictures into the dates. So, my wife's birthday, there she is, that sort of thing.

WILLIS: Fantastic. And I bet grandparents are just nutty about them.

OTTER: In fact they can't believe the technology. They just say, oh my gosh, you can do that? They love it.

WILLIS: Jack, thank you for being with us. We really appreciate your time. Great ideas.

OTTER: Merry Christmas.

WILLIS: Happy holiday s to you.

OTTER: Thank you.

WILLIS: The holidays can be a stressful time, especially when your wallets are stretched. What can you do to beat the holiday blues?

(BEGIN VIDEOTAPE)

FINNSTROM: Heaps of waste, it's nothing we want to associate with the holidays. But the government says every holiday season, while we're enjoying all of this, we're also generating more waste than during any other month of the year. About five million tons more waste.

So, step one of greening your holidays is cutting the waste. We brought you here to a nursery, because one way you can do that is by for foregoing the fresh tree and artificial tree, which will have trouble braking down when it's ultimately thrown away and opting for one of these, a potted tree.

Joining us now is Tom Johnsey with Armstrong Nursery. What's involved with getting one of these?

TOM JOHNSEY, ARMSTRONG NURSERY: Well, first thing that you want to do a little planning before selecting the trees. Know what you're going to do with it afterward. Some of these trees can get quite large. If we looking at Aleppo Pine, here. We have Monterrey Pines. Some of the -- this smaller one here, this little dinky guy, today, is an Italian Stone Pine, gets 35, 40-feet tall with an equal spread.

FINNSTROM: How popular have these been? JOHNSEY: These have been very popular. The living trees come in right before Thanksgiving and we typically sell them very quickly before Thanksgiving and (INAUDIBLE) -- he with just sold one a couple minutes ago.

FINNSTROM: Two other ways to cut the waste, Instead of using wrapping paper, put your gifts in decorative, reusable bags or wrap them in brown paper bags or even your kids drawings.

(voice-over): And consider sending off your holiday greetings by e-cards. The government estimates that ever year, enough of these paper holiday cards are sold I the U.S. to fill a football stadium 10 stories high. You'll not only help cut down on that waste. You'll also save yourself some money in cards and postage.

(END VIDEOTAPE)

(COMMERCIAL BREAK)

WILLIS: 'Tis the season to be jolly, but this holiday, stress may be the No. 1 emotion. The economic crisis has families strapped and the recession is taking a toll, not only on their wallets, but and also on their health.

CNN medical correspondent, Elizabeth Cohen, is joining us now, with the details.

Great to see you, Elizabeth. Let's talk a little bit about who is most at risk for this holiday stress.

ELIZABETH COHEN, CNN SR. MEDICAL CORRESPONDENT: Right, Gerri, earlier in the show, we were talking about how a lot of stress this year is centered around uncertainty, whether you can afford gifts like you did last year.

And who's the most stressed? Well, women are more stressed than men, according to a survey by the American Psychological Association. The women seem to be more stressed out about whether or not they'll be able to buy gifts like they did before. And parents, well, I guess it's not that surprising, parents were the worst. Let's take a look at this:

According to this Psychological Association's survey, 51 percent of parents said they were stressed out about whether they would have enough money for gifts.

WILLIS: And who can blame them, right? I mean, it's a tough holiday season for so many people. Right? You just have to worry about people. And as this tension mounts, it obviously has an impact on your body. What exactly does it do?

COHEN: Right. I think people don't always realize that stress, it's more than a problem with your brain, it's a problem with your entire body.

WILLIS: Although, it is a problem for your brain. COHEN: Absolutely it is. But, let's start with the brain, actually. The first thing that stress can do sometimes is cause headaches. And it's not just psychological, per se, it actually -- stress changes blood flow and a change in blood flow can give you headaches.

A change in stress hormones can cause your heart to not work quite as well as it should. Stress can also cause joint pain, like TMJ in the jaw. It can cause digestive problems. Stress weakens your immune system. There are several studies showing that if you are stressed out, you can't fight off bugs and viruses like you can when you're more relaxed.

WILLIS: You know, I have this last one, sleeplessness. You know, if I am stressed out, I am walking around the house at 3:00 in the morning every day.

COHEN: Well, call me, because I am too, sometimes.

WILLIS: All right, well, you know, I think a big question, then, for folks is, what can you do to relief this stress? What small steps can you take so you are not feeling it all the time?

COHEN: Right. There are a couple of specific things you can do. Maybe, the most important one is, pinpoint the problem. For example, if you are worried as a parent you are going to disappoint your children with fewer gifts than last year. Sit down and talk to them about it. Sit down and explain it to them. And that can go a long way towards making you feel better.

Also, get enough sleep. I know that's tough, but you're going to be able to handle stress a lot better when you're rested. I love this one, Gerri: volunteer.

WILLIS: Such a good idea.

COHEN: Exactly. Go do something for someone else less fortunate than yourself and it might put your problems in perspective. And also, except for when you are volunteering, stick to your routine. The holidays are a time for chaos and that's not always very good.

WILLIS: No, it's not relaxing in any way. I want to get back to gifts, though, for a second. The reality for so many folks this time of year, is that they just don't have the money to give what they wanted to give. So, you know, that's anxiety provoking. What do you do to relieve that stress?

COHEN: OK, I'm going to tell you, Gerri, about what a friend of mine did. She decided to go interview family members and wrote up a family biography. And she typed it nicely and put it together and that's what she is giving for Christmas this year. And you can bet that that biography is going to be on her family's book shelves for years to come, but other Christmas gifts, they could be forgotten in a matter of months.

WILLIS: That is a fantastic idea, make your own gifts. And it's something heartfelt. Elizabeth Cohen, thank you for that.

COHEN: Thanks.

WILLIS: Next week, a special edition of OPEN HOUSE, living a low-cost life. From home maintenance to home improvements, grocery shopping to shopping for clothes. How to get the best deals, save some cash and protect your bottom line.

As always, we thank you for spending part of your Saturday with us. OPEN HOUSE will be back next week, right here on CNN. You can also catch us on HLN, every Saturday and Sunday at 3:30 p.m. Eastern Time. And you can hear much more about the impact of this week's news on your money on YOUR MONEY with Christine Romans and Ali Velshi. That's Saturdays at 1:00 p.m. Eastern and Sundays at 3:00, right here on CNN.

Don't go anywhere. Your top stories are next in the CNN NEWSROOM. Have a great weekend.