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Spending Traps Last-Minute Shoppers Should Avoid

It’s crunch time. With Christmas and Hanukkah only days away, retailers are trying to entice last-minute shoppers to not only finish their holiday shopping but to buy even more than they might have planned. With the holidays looming, it’s easy to fall prey to these tactics as you frantically gather gifts for those on your list.

A salesman passes In front televisions displayed for sale at a Best Buy store in New York.
Chris Goodney | Bloomberg via Getty Images
A salesman passes In front televisions displayed for sale at a Best Buy store in New York.

So whether you’re firing up the computer to shop online or heading out to the malls, here are some tips to prevent getting caught in these spending traps:

Don’t go to the store without a shopping list — or at least a budget — in mind. The easiest way to overspend is to not have a budget. If you don’t have a plan, it’s easy to run out the door and grab anything that looks like a good gift for your friend or loved one and buy it, regardless of what it costs.

With retailers such as Wal-Mart moving up “Super Saturday” events— which usually occur the last weekend before Christmas — to this weekend, there are still deals to be had. But retailers know consumers may be getting nervous about getting their shopping done and will be putting items they can score a higher margin on in your path.

They’re also counting on you to buy those marked-down items, whether you need them or not. So before you buy your daughter the $5 pajamas, ask yourself, 'Does she need new pj’s?'"

If you know what you want, the job is even easier. Take advantage of tools such as price comparison websites, mobile shopping apps, or just plain Internet searching to find the best price. Map out where you’re going to go and what you’re going to buy.

Take a few moments to search for additional coupons on the retailer’s website before you head out the door or click "buy" on your online shopping cart.

Read the fine print. Make sure you know when the sale will actually occur and what item is actually discounted. Many retailers have been using “early bird discounts” or “secret sales” to attract shoppers, but if you’re not there at the right time you’re not going to score the deal.

Also, if last year is any guide, some retailers will begin to advertise their post-holiday sales even before Christmas arrives. If last year is a guide, advertisements for those after-Christmas sales could start arriving early next week. (According to Shop.org, Target and HSN started promotions on the post-holiday sales on Dec. 22 last year.) And due to the timing of Christmas this year on a Sunday, more people than usual will be home from work and able to shop on Dec. 26, so retailers are likely to be even more keen to advertise these events.

Beware of “bounce-back” coupons. Retailers are making a lot of use of bounce-back coupons. These are offers that encourage you to come back to the store at a later date to get some sort of discount. (Kohl’s , for example, offers “Kohl’s cash” promotions where you can redeem coupons for $10 or more off your bill during a designated period.) The trick here, of course, is to not overspend when you come back to redeem the coupon.

Don’t get lured in by rebates you won’t redeem. Retailers love to advertise how much you can save using a mail-in rebate. While after-purchase rebates can save you money, you have to know yourself: Are you committed to following through and send it in? Do you know the steps you’ll need to take? Make sure you have the required forms and receipts you’ll need. This can be tricky for gift-givers because many times you’ll need to attach a UPC code from the item’s packaging.

Don’t be tempted to spend just to rack up credit card bonus rewards or retailer loyalty points. Who doesn’t like to get something for nothing? Although loyalty points and credit card bonus points can seem like a freebie, real money was spent to earn those points. Retailers are relying on you to be so tempted into chasing those points down to earn merchandise and services that you spend more.

That said, taking advantage of credit card or loyalty program rewards can work to your advantage as long as you’re spending money that you have.

The other mistake people make is to forget to cash in those rewards; you may even find the perfect gift for someone on your list that way.

Instant-approval store cards and zero-interest financing can be another spending trap. Retailers may coax you into signing up for a store credit card by offering additional discounts, but think hard before you act. Having too much credit outstanding can hurt your credit score. Also, store credit cards often come with high interest rates, and having this extra credit may encourage you to spend money you don’t have.

"Buy now, pay later" offers often include introductory "zero-interest financing" options. These are tantalizing, but they can encourage you to splurge on big-ticket items such as furniture or electronics that you can't afford.

Before committing, reading the fine print is essential. You need to know what happens if your payment is late or if you miss it altogether. What happens if the balance isn’t paid in full by the time the offer expires? Often you will need to pay interest from the date you purchased the product as a penalty.

“Buy Online, Pick Up in Store” can be another pitfall. According to the National Retail Federation, more than half of online shoppers will continue to finish up their shopping online this year, but nearly as many will be going to department stores and one-quarter will be going to specialty stores to finish their shopping. Many retailers that operate both websites and brick-and-mortar stores are offering the option of buying items online and picking them up in the store. Sure, it’s a great way to make sure that you’ll get that gift in time for the holidays and save time, but it also can be a potential pitfall.

Once you’re in the store, there is a chance for retailers to try to sell more items to you. (Do you need batteries with that? How about buying an extended warranty or some gift wrap?)

And lastly, don’t confuse cheap with frugal. A low price tag doesn’t make an item a bargain. You want to get a good value for your money and know your gift will be appreciated.

Questions? Comments? Email us at consumernation@cnbc.com. Follow Christina Cheddar Berk on Twitter @ccheddarberk.

Retail