Cash-Saving Christmas Crafts are in Season

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By RAMIT PLUSHNICK-MASTI -- Associated Press Writer

WEXFORD, Pa. (AP) — Spread out on Clare Bello's vinyl-surfaced work table is the evidence of a year-old hobby — and now, the means for this year's Christmas.

The clear, compartmentalized boxes brimming with colorful beads, semiprecious stones, clasps and string used to be a fun, creative way to keep busy while watching TV and hanging out with family. This year, the jewelry Bello makes will not only be Christmas gifts for women in her family, she also hopes she can sell enough of her handmade crafts to make the money she needs to buy gifts for the men and boys.

In the current economic climate — with unemployment rising, housing prices dropping and stock portfolios shrinking — many are cutting back on holiday shopping. Gift-buying budgets are smaller and many people, like Bello, are planning to make gifts whenever possible.

"Christmas this year has just been really tough and I think it's been tough on everyone," said Bello, 43, who is the CEO and co-founder of Vertical Claims Management, a medical malpractice claims company. "My husband's an attorney and I'm an executive and we're still feeling the crunch, significantly."

The Bellos aren't alone. Nationwide, crowds came out on Black Friday — considered one of the busiest shopping days of the year and traditionally marks the first day of the holiday shopping season — and spent about 3 percent more than last year. But analysts predict that will slowdown in the countdown to Christmas.

Robert Dye, a senior economic analyst with PNC Financial Services Group in Pittsburgh, predicts a 6 percent to 7 percent decline in consumer expenditures for the fourth quarter — the biggest drop since 1980. Shoppers are going to cut back on lavish goods and return to more "traditional values," Dye said.

People will "shift the focus from gift giving, more to family reunions, catching up with friends," Dye said. "They're going to need to be creative ... making gifts, organizing events, things that are not going to require an outlay of a significant amount of cash."

First, the Bellos, who live in Wexford, an upscale suburb about 25 miles northwest of Pittsburgh, halved their gift-buying budget for their immediate family — Bello, her husband, Sean, 44, and their two children, Michael, 9, and Stephen, 6 — from $1,000 last year to $500 this Christmas.

Then, they decided the women in the family would get handmade jewelry.

Now, Bello is selling her one-of-a-kind necklaces, bracelets and earrings to earn the cash for whatever gifts they buy. Already, Bello has made about $200 selling her creations — just $300 short of her goal. What she is hoping will be a popular item this holiday season are wine charms — dangly, beaded party glass identifiers that cost about 50 cents to make but can sell for between $3 to $5 a piece.

Anything Bello makes above $500, will go toward buying more beads and beginning what could become a full-fledged business. While wary of investing too much in the current economy, Bello is considering a Web site and hopes to attend craft shows, creating a third avenue of income in these trying times.

The Bellos believe making gifts will save them hundreds of dollars. For example, normally Bello would buy her mother and aunt something like Omaha steaks online, a cost of between $60 to $150 or more, depending on the package. This year, the women will get necklaces that cost about $40 to make, but could cost up to $100 in a store. In all, Bello said she will spend between $100 to $150 for beads and silver for gifts for at least six women.

Steve Baumgarten, an equity analyst at PNC Bank, said in addition to making gifts, he expects people to downgrade in their shopping — hitting the dollar stores and the Wal-Marts, rather than the Macy's and the Saks.

"The magnitude in consumers cutting back in their purchases is going to be greater than what we've seen in more recent history, the past 20 years or so," Baumgarten said.

Stephanie Nelson, the Atlanta-area founder of "The Coupon Mom" Web site, says this is the perfect climate to be creative. For instance, people can make "gifts in a jar" — a simple mason jar with the layered ingredients for a cake or cookies or soup or bath salts — for less than $5, a gift that costs $30 in a store, she said.

An alternative, could be buying canned pumpkin discounted after Thanksgiving and making breads or pies for friends and neighbors, Nelson said. Or, filling two-thirds of a jar or mug with glass stones, placing a flower bulb on top and then decorating it with a bow and instructions to water it — a $2 item to make that costs $20 in the store.

"I actually believe that frugality is going to become fashionable," Nelson said. "It's kind of in poor taste to be ostentatious at the moment."

Linda Nanni, a 55-year-old administrative assistant to a financial planner, says she is worried about her job, though she isn't panicked — yet. Already, she has decided to buy just one big item for each of her two sons. Shopping in Costco in the Pittsburgh suburb of Cranberry on a recent Saturday, Nanni said she is also planning to bake cakes for her neighbors this Christmas, people she would normally buy gifts for.

Nearby, in Jo-Ann Fabrics, the Sharlow sisters — Jana, 46, and Beth, 42 — are browsing through aisles of colorful wool. For Christmas, Jana has crocheted about seven hooded scarves in different colors for the women in her family, while Beth has knit scarves from wool she bought while vacationing in Iceland.

The wool cost about $120 in Iceland and Beth — a professor at the University of Pittsburgh — said she has knit seven scarves from it. A store-bought scarf in Iceland costs between $75 and $100 a piece, she added. Now, Jana — a director of recruiting for Eat 'N Park Hospitality — is looking for chenille to make hats. Overall, the women estimate their crafts could save them hundreds of dollars.

Back at the Bello house, Christmas is at the tail end of the family's cost-cutting. For months now, they have been carpooling, eating home more and even keeping the thermostat lower. Now, beading has become a family event. Clare Bello's boys help choose color patterns, and will likely make beaded window charms for family and friends.

"Now, you know, you just really have to try to put money in the bank and cover the mortgage and cover the gas bills and everything else and keep food on the table," Bello said.

Copyright 2008 The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.

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