Keeping your sanity intact in sales season

'Money's a horrid thing to follow, but a charming thing to meet,' wrote Henry James.

For most of us, spending is as much a part of Christmas as pudding, turkey and certain libations.

Yet binge buying is often as common an excess during the holiday season as binge drinking. It can be just as injurious to our health and family life. As James suggested, spending power is a good servant but a terrible master.

Sadly this is a lesson some people will learn the hard way over the next few months, as they measure the impact of the holiday sales on their savings, credit ratings and all-round financial wellbeing.

To boost sales this year, many major stores began discounting prices earlier in the pre-Christmas season.

In spite of this, while the past couple of weeks are normally their busiest time of the year, some shopping centres have remained half empty. This is partly because of the poor physical infrastructure provided near traditional town centres.

High street shopping precincts are struggling to keep up with demand for low-cost, easily accessible parking. High prices on privately owned car parks are driving more and more consumers into the waiting arms of undercover shopping malls.

The early drop in shopper numbers is also the result of a stand-off between shoppers and retailers. It's a contest to see who will blink first and when the real discounts will kick in, to boost sales.

Yet while many bricks-and-mortar stores are seeing slow trading, online shopping and new variations on the same are likely to break all records this year.

A boom in web-sales is now accompanied by a rise in 'click and collect' services. People purchase goods online but collect items in bricks-and-mortar stores.

EBay, for example, allows some customers to pick up goods from their local Argos store. At least 50 eBay retailers are already using the service, in partnership with 150 Argos locations.

Meanwhile, Amazon offers customers the opportunity to collect using purpose-built lockers in various locations around town. The web giant is also plans to reduce items by up to 40 per cent on Christmas Day, reflecting the fact that people are now more willing to buy on the holiday itself than they were a few years ago.

Customers are also becoming more aware of how stores set their prices.

Some major retailers, including the online variety, boost their prices quite early in the year with the goal of dropping them, to recommended retail levels, closer to Christmas. What appears in the holiday season to be a real bargain may not be such a great deal after all.

Shoppers, then, are becoming more savvy, which is no bad thing. Trading may have shifted somewhat from the offline to the online world, but we are still buying stuff big-time come the holiday season.

It's worth remembering, though, that a bargain is not a bargain if you don't really need it, or if you're relying on over-extended credit to cover the purchase.

Just prior to Christmas 2010, when we were still in thrall to our worst recession in 30 years, economic indicators suggested that Brits were becoming better savers.

Yet post-Christmas sales that year told a different story. They revealed that the consumption lifestyle of the freewheeling Noughties still maintained a powerful grip on the national psyche.

Now as then, some holiday shoppers will act according to a carefully laid out plan. Many more, though, will buy things just because they're on sale, even if the discount isn't as real as it might appear.

If we're to steer ourselves and our families into a full financial recovery - and, more importantly, avoid boom-and-bust cycles in future - we need to make spending frugally more of a lifestyle choice.

We need to become more disciplined about our consumption, without going to the other extreme of living in constant austerity.

One of the gloomiest recurring news stories these days relates to year-on-year growth in national debts and borrowing levels.

In 2009, the gross US federal debt - the gross amount of debt issued by the US Treasury - stood at $11.9 trillion. Today, it has grown to over $17 trillion. That's $53,000 of debt for every person in the country.

According to the US Treasury, almost half of the debt is owed to foreign investors, the largest being the People's Republic of China and Japan.

In the UK, gross government debt for 2012/13 is forecast to be £1,412 billion. At the end of March 2009, it stood at around £796 billion. Our debt now runs at around 73 percent of GDP - not as high as other countries like Italy and Japan, but still a cause for concern.

Most of us find the rapid, seemingly unstoppable increase in national debt disturbing. What kind of inheritance, we ask, are we leaving to future generations?

Yet this tendency to run up debt while living on the never-never starts at a much more personal level.

It's almost axiomatic that, in a democracy, people get the governments they deserve. Freely elected governments tend to reflect the priorities of those who placed them in power.

If we can't see beyond a consumption lifestyle on a personal level, if we can't recognize the benefits of frugality, we'll never vote for politicians who have the willpower needed to keep debt in check on a national scale.

There are two factors at work in our fondness for spending, and especially spending on credit. The first is the digital revolution, which affects everything from music, books and movies to money.

Apple, Google, Facebook, Amazon and others are attempting to bring as many of our real-world experiences as possible under a digital umbrella. They're doing so not because they're driven by purely humanitarian goals; their motivation is the fact that our personal data is worth money.

In the age of Big Data, predictive analysis and location-based marketing, personal information is the new global currency.

One part of this revolution is the digital economy and the increasing digitisation of cash. We think of money less and less as a physical thing to hold in our hands; it is becoming more and more an ethereal commodity, to be sent from one computer to another without ever having a physical form.

Digital money has many advantages, but it has two major downsides: it is an easier target for fraudsters and it has no weight, no substance; you can't tell when you've exhausted it.

Not so long ago you could tell when your money was running out because your wallet was getting lighter by the minute. Money that's reduced to the ones and zeros of binary code is ethereal and much easier to lose track of.

The second factor feeding our taste for spending and living on credit, is the strong existentialist, instant-gratification streak running through our culture.

Existentialism as a philosophy is more complex than can be outlined in an article like this. In essence, however, it says that as there is no higher meaning in life, the highest good we can achieve is to enjoy as many good experiences as possible before we die.

As a lifestyle philosophy this is not likely to produce long-term thinkers, nor people who plan strategically. It is ideal, however, as a basis for short-term consumerism.

Entranced by live-for-the-now thinking, many of us seem half inclined to believe that there may be a fairy godmother solution to problems with personal debt.

If we can just put off the day of reckoning long enough, and stretch our moment of pleasure to the max, someone else will miraculously ride to our rescue.

In some cases, this shapes our expectations of political leaders.

I can't help feeling that, for all his personal charm, wishful thinking was one of the factors behind the remarkable rise of Barack Obama to the American presidency. He rode into office not on the back of his experience as a legislator as much as his ability to embody a promise; a pledge to solve big problems with a minimum of turmoil or fuss.

In retrospect he has failed to live up to anything like the hype surrounding his election. A recent poll Washington Post-ABC News poll showed his approval rating at just 43 percent. Only one other president, Richard Nixon, has had a lower rating at this stage of his presidency (29 percent).

Nobody could have lived up to the expectations Obama faced - and encouraged - because they were based on voters' wish fulfilment.

In the end, there are no fairy godmothers. A positive mental attitude often serves us better than the alternative, at least when it comes to facilitating innovation. But a drive to 'keep believing' will not, on its own, turn things around if our attitudes to earning, saving and spending are built on shaky ground to begin with.

Whether on a national or a personal level we each have to pay the piper sooner or later. There really is no such thing as a free lunch.

Perhaps it's time we learned how to say 'no' a little more often, to delay gratification knowing that there's more to our personal value than what we earn, own, or have the financial capacity to give away.

In his influential book Affluenza, British journalist and psychologist Oliver James warned that our keep-up-with-the-Joneses consumerism is like a virus spreading through our culture. It is leading, he said, to higher than normal levels of personal and social distress.

The Affluenza virus, as he called it, is a pandemic arising from our obsession with having more of everything - money, status, fame - at the expense of being more.

Because of the virus, wrote James, we're insecure, constantly comparing our lot with that of others, especially those who have more than we do.

We're also alienated, because we keep many people at a distance in the pursuit of career. The illness also leaves us feeling incompetent because no matter how successful we become it never seems enough; we try ever harder to climb a ladder that has no end.

It's often during the New Year sales-rush that homeless charities in London and other major cities report a rise in middle-class homelessness.

In the midst of relationship breakdowns, unemployment or both, even professional people can quickly use up their savings, max out their credit cards and, when friends and family no longer offer help, find themselves without a fixed abode.

Homelessness is an extreme situation and one that, thankfully, won't directly affect the majority of us any time soon. Yet the fact that it can come on people so quickly, points to the insecurity inherent in living, or spending, as if there is no tomorrow.

Post-recession, we may still have some important learning to do.

The credit card is a useful tool, but using it wisely requires a disciplined mind and steady emotions.

There's nothing better than getting to the end of the sales madness and knowing that you still have your savings, credit rating and sanity intact.