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YOUR BOTTOM LINE
Budget Holiday Gift Giving; Credit Card Debt-Free; Black Friday Myths; Good, Yet Cheap Wine; Tony Hawk Interview
Aired November 20, 2010 - 09:30 ET
THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.
CHRISTINE ROMANS, HOST: All right, let's face it, we all spend too much this time of year. So we're dedicating our show this morning to helping you make smart decisions about your money this holiday season beginning right at home with your family and friends.
What do you do about those sticky money situations? How to entertain for less. The best wines on a budget for Thanksgiving. We tasted some. Just five days away.
And of course, how to undo the damage done. Digging yourself out of debt after you've maxed out those credit cards.
YOUR BOTTOM LINE starts right now.
All right, we've all been there, the inappropriate dinner conversation, someone asking outright for money for the holidays, your in-laws expect an expensive gift or you're invited to 15 holiday parties and you're expected to bring something to each one.
Dr. Jeff Gardere is a clinical psychologist and contributor to HealthGuru.com. Carmen Wong Ulrich is personal finance author and Sarah Humphreys is the executive editor of "Real Simple" magazines.
Let's first talk about the money, the moolah, coming out. Seven or $800 a year is what people spend on gifts, decorations, the meal, the whole bit. It's an awful lot of money and awful lot of stress.
How do you tactfully not spend that much if you found yourself in a little bit of financial hole, like many of us have?
JEFF GARDERE, CLINICAL PSYCHOLOGIST: Well, we always talk about, as financial experts, shrinks and so on being on a budget. And it's important that you put a major budget out there and you put a spread sheet and look at everyone that you need to take care of from family to doormen and so on and figure out with your budget with a certain amount of money that doesn't break your bank, how much you need to spend and how are you're going to distribute it and how smart you're going to be about distributing that money.
ROMANS: Well, people who care about you don't want you to go broke.
CARMEN WONG ULRICH, PERSONAL FINANCE AUTHOR: Well, it's really this guilt that I hear every single year. It's, well they expect it and if I don't, what happens? People who do care about you, they don't want you to dig yourself into a hole to get them a gift and if they do, they're not your friend. But also too, don't have any shame in basically cutting back or not being able to give cash tips this year, especially if you're unemployed. Here's the thing, send a very nice note. I so appreciate your service. I'm so sorry I'm not able to give this year. They will understand. I mean, you have to put up these boundaries. And understand, this was our third year, or third Christmas that we're in this recession, this struggling time. People get. People know.
GARDERE: They understand.
ROMANS: How do you do it etiquette-wise? From the "Real Simple" point of view, you know, you're always giving advice to your readers. How do you do it and not look like a cheapskate or a Grinch?
SARAH HUMPHREYS, REAL SIMPLE MAGAZINE: Well, it's all about creativity, right? It's the thought that counts. We always say that. That's true. So, if you're creative about your gift and you're thoughtful, it's going to mean so much more than spending a whole lot of money on a new flat screen TV or whatever anyway. So, homemade gifts are good if they're thoughtful. I won't turn down chocolate bark or an infused vodka. You know, you just need to be creative with your gifts and spend some time. Time is just as important as money.
GARDERE: And I love that emotional aspect of it, of writing a note from the heart, that really just diverts your attention away from the amount of money to, wow, that person really thought about me.
ROMANS: You have a great idea for your own family that you're doing. Instead of just giving $20 gift cards to everyone where essentially, come on, you're passing money around if you do that, right? And those gift cards can be lost in the bottom of your bag or you buy them for someplace and the person doesn't really shop. What are you guys doing?
ULRICH: OK, family, this is what we're doing.
GARDERE: You're warning them, right?
ULRICH: This is what we're doing. Well, because every year, what we do is we pick out a name out of a hat, kind of secret Santa with the family. I mean, we've got six kids, we've got grandkids, all these people. So, what we do is we pick a name out of a hat.
But what's happening is if you say OK your limit's $20, so many people fall back on that gift card thing. So this year, what you're going to have to do is, it's got to be something from your childhood.
Like, for example, I'll get my brother "Schoolhouse Rock," I'm not saying I will, but that's my idea, if I pick you out of the hat. But that's what you do because it's thoughtful, it takes the attention off the amount of money. You have a memory that you share together and have fun.
ROMANS: And you go on eBay to spend $10 to find -- ULRICH: Fantastic.
ROMANS: Let's talk a little bit about the gift of cash, because there are some people who are going to say to their parents, to their nieces, to whoever, look, we're really in trouble, if you're going to get us something, please I don't make kit be velveteen slippers, please I don't need more bath gels, can you just give me 50 bucks? What do you say? How do you handle that situation?
GARDERE: Well, I do two things. When people ask for money, I know that they're probably in trouble and when you're in trouble, you're not really thinking. So instead of perhaps giving the money, I may give them advice on how they can get their own money.
ROMANS: Dig a little deeper, find out what's really going on.
GARDERE: Find out what's going on and give them some strategies for what it is that they need to use the money for. But I will say, OK, I will give you a certain amount of money, what I can afford, just know that I'm giving it to you from my heart. That's it.
ROMANS: We know that more people, 58 percent say they are giving cash this year. That's up from, I think, 44 percent last year. So we do know that more people are going to be giving cash as a gift. I guess the important thing is so it tactfully and as you say, to ask them some questions. Let me ask you quickly about the party season, because I'm trying to find a date to invite people to my house for a little party and I was shocked the amount of time people spend at parties. I mean hours and hours, 20 percent of people -- 24 percent of people spend more than 20 hours at holiday parties. That is a long time.
Should you bring something? Are you expected to bring something? What are the perils of all this -- can you say no? What do you think?
HUMPHREYS: I think you should drink something. You don't have to come up with 10 bottles of wine and a spread of cheese and whatever, a side of beef. You don't need to do that. It's the thought that counts. Someone is being generous enough to invite you to a party, you should bring something. It can be little.
ROMANS: And we do have some very inexpensive wines that are cheap and cheerful later on in the program, so I'm glad you said that. But yes, you can do that, you can also bake a sleeve of -- bake cookies with your kids, put them in a cellophane sleeve, there's a lot of things you can do and you don't have to go to these parties.
GARDERE: And as long as you show that you're participating. You know, back in the day we got a million offers to go to parties and everything was catered, everything was taken care of. That's not happening anymore, not in this economy. So, it's important that you show that you're participating and you care by bringing something even if it's inexpensive. Again, it's the thought that counts.
ULRICH: And if you're the party-thrower, Christine, if you're the party thrower, and we too, it's just --
ROMANS: Can I ask you exactly what I need to bring? Carmen, I need you to bring a bottle of wine.
ULRICH: Yes. What you do, on the invite, you don't say, please don't use those words potluck, but just say bring your favorite bottle of bubbly, red, or white. Something that's like encourages everyone to say, OK, this is your personal stamp, I love this bottle.
ROMANS: And we're going to talk about this a little bit later, too, but if you don't have a job and you're going to all of these parties, I think you should be going to all these parties, not just to be dazzling and you should not drink too much and be ready to network to try to get a job. We'll talk about that a little bit later. Carmen Wong Ulrich, Sarah Humphreys and Jeff Gardere, thank you, all of you.
ULRICH: Thank you, Christine.
ROMANS: Fascinating stuff.
OK, up next, take our challenge to be credit card debt-free in three years. Can you do it? It starts with not overspending during these holidays. We've got a plan to pay down those bills before it's too late.
ROMANS: Thirteen thousand dollars in credit card debt may sound like a lot, and it is, but it's not uncommon. It is possible to dig yourself out of that kind of debt in just three to five years. Credit counselor David Flores showed me how to do it.
(BEGIN VIDEO CLIP)
You're on the ropes, right? You've got rent or a mortgage. You've got a car loan, you've got groceries, you got a student loan. And you can't afford -- you just lost a job. How do you prioritize the basics, even? Student loan you get a deferment?
DAVID FLORES, GREENPATH DEBT SOLUTIONS: Yes, I was going to say, you want to take a look at this and say OK, well, where is there assistance? Student loan companies will typically help with hardships.
ROMANS: They usually have lower interest rates too, right?
FLORES: They do. They usually do. But yes, so putting these into deferment or forbearance can help, so you're eliminating this even if it's temporary.
ROMANS: You got to get tough on the groceries and tighten up.
FLORES: You got to get tough on the groceries. On the rent or mortgage, long-term, is your situation going to -- do you see it changing? ROMANS: You might need to downsize.
FLORES: Yes, and that -- this is the hardest part. A lot of times when it comes to rent, downsizing an apartment, people don't want to do that, but sometimes it needs to be done if their situation is a long-term situation, not a short-term.
ROMANS: I mean, se, I think bottom line, $13,000 of credit card bills -- credit card debt at 29 percent interest, if you paid only the minimum, it would take 35 years to pay it off. Most people don't know that.
FLORES: They don't.
ROMANS: They just don't know it. That's a long time -- that's a lifetime.
FLORES: Right. And that's why -- you know, if you can afford to make the minimum payment where you can pay off your debt sooner, great, but if you can't afford to pay the minimum, that interest rate, 30 percent, that's a lot. Seeking credit counseling will help to try and get those payments manageable, get that interest rate down to, you know, maybe a 10 percent interest rate, a six percent interest rate, something manageable so that you can pay off that debt without shelling out, you know, a ton of extra money.
ROMANS: All right.
(END VIDEO CLIP)
ROMANS: David Flores says one of the toughest parts of digging out of that debt is getting started, realizing the number. What is the number? How much do you owe? He says once you come to terms with it, start pay down your debt in manageable chunks little by little. After all, he says little by little is how people get themselves in debt to begin with.
Listen, with so much out of your control in this economy, you must take back control of your own finances. That's why I wrote a whole chapter of my new book, "Smart is the New Rich" about digging out of the credit card debt no matter how hard it may seem. And we give you ways to do it, but you can't start investing in your future until you've paid off your past.
One way to stay out of debt in the first place is to not to buy into the hype or the misinformation. Black Friday myths debunked, straight ahead.
ROMANS: All right, you won't believe this. The average person, according to consumer reports, will spend 15 hours shopping for gifts this holiday season. You will never get those 15 hours back, so before you head out to Black Friday, let's dispel a few myths.
Myth No. 1, Black Friday prices are always sale prices. Well, according to DealNews.com, in the past several years, retailers -- well, retailers have been caught jacking up prices before Black Friday, then lowering them with supposed discounts, leaving the price higher than before. That's a tried and true retail trick.
Next, the deals are so good on Black Friday, they're worth sleeping overnight on a curb for. Well, most stores, being first in line at 5:00 a.m. simply guarantees you'll get shoved around by the 500 people behind you. Instead, check for deals online and save yourself some sleep.
And they say prices on Black Friday are the lowest you'll see all year, but many Black Friday deals are matched or even beaten later in the season. If a deal doesn't make you swoon, wait for a better one. Speaking of deals, you won't want to miss this, the very best bargains on the very best wine in just 60 seconds.
ROMANS: It's time to get planning for that big Thanksgiving spread. And with lots of family to feed, nobody wants to spend a fortune on the wine. Ray Isle is the executive wine editor at "Food& Wine."
Ray, what better time to have you one?
RAY ISLE, FOOD & WINE: Absolutely, I mean this is Thanksgiving time; you've got to have some wine for that 27-person dinner that you're going to host.
ROMANS: Actually, I am hosting about a 27-person dinner. And I'm going to come out with a nice bottle of wine at the beginning, well, two bottles of wine, actually, or three, for my 27 guests, and then I have to move into something a little less expensive.
ROMANS: So, walk me down here. You've got an $8 bottle of wine here on my left. Tell me what you like about this one.
ISLE: Smoking Loon Shiraz. Smoking Loon, I like the name, for one thing. It's a really terrific little wine, eight bucks a bottle. I've been saying this years, Shiraz for Thanksgiving because people have been drinking pinot noir a lot in the past couple of years, and they've been drinking so much of it the prices have kind of crept up. And Shiraz, because people aren't drinking it, prices have crept down. So, this is a really stupendous deal for $8.
ROMANS: A stupendous Shiraz. And so when it's a Shiraz, it's just Shiraz grape, is that right?
ISLE: It's just the Shiraz grape. Well actually, you know, California labeling laws, U.S. Labeling laws, in fact, it only has to be 75 percent of that grape. So it could have 25 percent of anything, but mostly it'll have, you know, the preponderance will be that great.
ROMANS: This is also a Shiraz, called Substance Washington State.
ISLE: Yep, Washington State, and made for our Winemaker of the Year for our American Wine Awards. And he makes high-end Shiraz that are really wonderful and he also makes this $15 a bottle Washington State Shiraz. And I think it's a little more robust than the Smoking Loon, a little richer and I think it's a fantastic deal for the money.
ROMANS: And here you have Beaujolais. And this is always something that you can rely on, right? It's got a taste that you know what you're going to get.
ISLE: Yes, Beaujolais is the classic kind of bistro wine. It's tannic (ph), it's fruity, it's easy to drink, it goes with - because it's not tannic (ph) it goes with a vast range of foods. This is about $11. I actually think that, you know, there's a huge Beaujolais Nouveau push every November. That's marketing. It's a marketing gimmick and for $2 more you can get a Beaujolais Blanc which is much nicer and much more interesting wine.
ROMANS: Really, do you serve this off the top? Do you start right at the beginning or the dinner?
ISLE: It's a great red wine for white wine lovers because it's not too heavy and too intense. So it's --
ROMANS: Let's talk about white wines, though. I mean, you're supposed to have white with poultry except Thanksgiving is a little different. You can do with a red with poultry, too. I mean, that's a misnomer, right?
ISLE: Yes, you can do a red with poultry, you can do a white with poultry, you can do a red with fish. You can mix it up. And the truth is if you have that many people coming for Thanksgiving, someone's going to want red and someone's going to want white and they're going to be firm about what they like and don't like. So, you might as well have both.
ROMANS: This is a Sonoma County Chardonnay. Chardonnay is a pretty standard white. You should probably have a bottle of Chardonnay because the chances are there's someone there who just drinks Chardonnay.
ISLE: Yes, it is a crowd pleaser. There's going to be a Chardonnay fan in the audience. Rodney Strong Sonoma County Chardonnay it's about $13 a bottle, though it's often discounted below that.
ROMANS: Oh, really?
ISLE: Yes, it's got big enough production that they can do some deals. And it's a classical California Chardonnay, rich fruit, nice silky texture and the other one, my Chardonnay alternative.
ROMANS: For those of us like me who have said I cannot have one more glass of Chardonnay. It's the standard go-to I need to get a little more creative. ISLE: I brought this to save you. It's a Yalumba Viognier, which is a French grape, it's an Australian version and it's made without much use of oak barrels. It's very light and crisp and really fragrant and I think it's got a pretty nose and great food wine.
ROMANS: At $11 a bottle, that's something that is pocket- friendly, too.
ISLE: Very much so.
ROMANS: Tell me how you recommend -- so the meal is starting, do you start with a white maybe or before dinner and then you move into the reds at dinner? What's your perfect solution?
ISLE: My solution is to start with either white or sparkling, an affordable sparkle, Cava or Prosecco is a great way to start because it's festive or a light white that doesn't have a lot of oak on it like the Yalumba or like a Sauvignon Blanc and move into heavier, bigger wines, Chardonnays, Shiraz that kind of thing, to go with the main course when you've got stuffing and turkey and potatoes and sweet potatoes, and you know, the list goes on and on and on.
ROMANS: The reds are a little bit easier if you have a lot of people and you don't have a lot of refrigerator space too, because they don't have to be chilled like a white wine needs to be chilled, but you can always put them out the back door if you have to with the white.
ISLE: Yes, and Beaujolais actually tastes quite nice when it's chilled down a little bit. It's one of the few reds that really take a chill pretty nicely.
ROMANS: One thing I think is fascinating about these -- we're going to put all of these up on our Web site and I'll put these on Facebook and Twitter, as well -- but these are $8, $15, $10, $13 and $11. This is the thing that you can afford and not break the bank on the wine part. We know the National Retail Federation says people are going to spend some $750 this year, per person on food, decorations, drinks and gifts.
So, you know, if you save on the wine part, maybe you can spend more on the actual turkey and prices are up.
ISLE: Yes, turkey prices are rising.
ROMANS: OK, Ray Isle, thank you so much, it's a pleasure to have you on board and we'll do it again next year.
ISLE: Great, thanks for having me.
ROMANS: Thank you so much.
Up next my one on one with skateboarding icon Tony Hawk on everything from business to bullying, he even got me on the board. Got to see this.
ROMANS: If your kid's got a skateboard you probably know our next guest pretty well. Tony Hawk started skateboarding when he was just nine years old and he turned that passion into an uber success career both in the skate park and now in the boardroom. He's got a new book out called, "How did I get here? The Ascent of an Unlikely CEO." And he is an unlikely CEO.
I recently spoke with Tony about that book, about building a brand and also had a bit of surprised myself at the end of the interview. Take a look.
Why did you decide to write the book? I mean, there's some really great anecdotes in there and you know, what made you do it now?
TONY HAWK, SKATEBOARDER, CEO: Well, the last book I wrote was, is my autobiography about 10 years ago, and I felt like a lot has happened since then, a lot of different business opportunities and successes and failures and I felt like there were a lot of really good stories there and kind of to write a guide for people who maybe want to get into a new business or maybe break into our industry a little bit.
ROMANS: It's interesting because right now with Twitter and Facebook and with digital media, everybody can be their own brand. How do you become a brand? How do you tell somebody like --
HAWK: Firstly, you have to have something to offer. You know what I mean, I don't believe in being famous just because you're famous. You know?
ROMANS: We have a few of those around.
HAWK: They're growing in large numbers, It's scary. But and also you know, if you have a talent, learn every aspect of that and I think that passion will shine through and if you want to make a brand or A company out of that, then you should, because your enthusiasm will come through in everything.
ROMANS: One of the things about the Tony Hawk brand is that you're moving it forward, now there's Shred. Tell me about the video game franchise.
HAWK: The video games literally have changed my life. I mean, you know, we started doing it over 10 years ago, it was something I was just excited to get involved with because I love video games and I knew that skateboarding could lend itself to a really good type of game but I just didn't know of the residence it would have. And now we're into skateboard controller that you stand on, it's motion sensing every twist and turn that you do is emulated on the screen.
ROMANS: I went on Twitter and Facebook and ask people what do you want to ask Tony Hawk? What's he like? What are you like? So I'm going to ask you, the people want to know. HAWK: What am I like? I think I'm pretty easy-going, determined, passionate and hopefully they think I'm funny.
ROMANS: Do you think you're funny?
HAWK: And not in a laugh at you way but a laugh with me way.
ROMANS: It's interesting because you do have such a following with younger people, with young kids, with kids who maybe weren't even born, frankly, when you were starting skateboarding. What do you think about this recent outbreak of kids and bullying and just how painful it is for young people, for somebody who resonates with young people, what do you tell them? What do you think about this?
HAWK: Well, I think it's tragic. I mean, I'm shocked that somehow it's escalated. I mean, honestly my best advice is just don't read it because if I went on the Internet to look at the bad things people say about me and my choices in life and you know, like everyone wants to call you a sellout if you're making money doing what you love or whatnot, I would go crazy, you know, and I would probably get really depressed.
ROMANS: Were you a cool kid when you were young and you were starting to skateboard?
HAWK: No, I was made fun of probably more than most people because skating was the furthest thing from cool you could do. I mean, I was literally like, I was below nerds on the hierarchy of cool, because I still rode, which was like a kid's toy.
ROMANS: Did anyone ever pick on you or bully you?
HAWK: Yes, I use the term loosely, but the jocks in school would like pick me up, swing me around and --
HAWK: Yell at me "skater, skater!" it was a different time.
ROMANS: And what did you do, just like forget it? You got your board, you know you're good at it, you love it?
HAWK: Yes, it wasn't going to make me quit or try to fit into whatever they were doing.
ROMANS: If you weren't a skateboarder, what would you like to be? On the Web site I'm told it says a concert --
HAWK: I played violin when I was young and I was doing pretty well at it and playing like kind of concerts outside of the school. At some point I thought I had to make a distinction because my music teacher really wanted me to do more stuff outside of school and I told him look I want to skate in my free time and he kind of, he thought it was all or nothing. So, you know, he said, you can't just dabble in this, you're good at it and I said well then I got to give it up. ROMANS: OK, so for the record, never been on a snowboard, never been on a skateboard and I'm a little nervous, but you're going to show me?
HAWK: Yes, sure. Yes.
OK, there you go. Ready?
HAWK: Now, just lean forward.
ROMANS: Oh, my God. Oh, if you lean this way you can --
HAWK: Yes, that's turning. That's called turning. And then you're off. There you are, you're skating.
ROMANS: That's cool.
Tony Hawk is pretty cool. That was a lot of fun to be taught how to ride a skateboard by Tony Hawk. And usually you're wearing safety gear. That was just a little demo, don't try that at home.
That's going to wrap things up for us. Time now, though to send it back down to CNN Center for more CNN SATURDAY MORNING and this morning's latest news, that's with my friend, T.J. Holmes.