The National Retail Foundation said that gift cards are the most requested gift again this year, which should come as no surprise given their popularity since being introduced. However, consumers thinking about purchasing these cards for their loved ones may want to reconsider. It may be convenient to give a gift that will always be the right size and color, but there is some risk involved that must be considered.

Research by the Tower Group found that gift card holders lost more than $100 million this year alone. Big stores filing for bankruptcy, including The Sharper Image and Linens ‘N Things, led to the majority of the losses while more may be on the horizon. Circuit City, which filed for bankruptcy a few weeks ago, asked and received court permission to honor its gift cards, but others may not be so lucky.

Some gift cards also have design flaws that could make them less valuable. For example, some gift cards have expiration dates where the value becomes worthless if it’s not used. Meanwhile, other cards, notably those provided by Visa and MasterCard, charge fees if they are not used that can add up to a few dollars a month. Both of these attributes make gift cards far less attractive than cash or actual gifts that do not lose value.

So, think twice before you buy your loved one a gift card this holiday season…

The past year has been a rollercoaster ride for many U.S. citizens with markets moving up in the first half only to plummet in the second. As a result, many independently employed people, such as real estate investors, are sitting on a mountain of tax liability despite heavy losses. This tax debt can be difficult to deal with, but here are some tips on setting up payment plans and reducing the amount you owe.

There are five strategies to get out of your IRS problems:

1. Installment agreement: The IRS lets you setup a monthly payment plan for paying off the amount that you owe.
2. Partial payment installment agreement: The IRS recently setup a new program where you have a long-term payment plan to pay off the IRS at a reduced dollar amount.
3. Offer in compromise: The IRS has a program where you can settle your tax debts for less than what you owe if you make a lump sum payment or accept a short-term payment plan.
4. Not currently collectable: A program where the IRS voluntarily agrees not to collect on the tax debt for a year or so.
5. Filings bankruptcy: Tax debt can be eliminated under the strict rules of a Chapter 7 or Chapter 13 bankruptcy petition.
   

It is important to consider the long-term ramifications of any actions that you take. Payment plans put a financial burden on you going forward and may involve paying interest. Meanwhile, a bankruptcy may eliminate your debt, but it will also hurt your credit rating over the long-term. This could make it more difficult to get home or car loans in the future.

The savings rate in the United States has traditionally been negative since the Great Depression fears ended. However, consumers are now experiencing the same thoughts and feelings of their ancestors and are looking for ways to save. So, what are some good ways to boost your savings and have more cash down the road? Here's five tips that we've found to be most effective:

1. Automate Your Savings - Setup an automatic 401(k) or IRA retirement plan, so you don't even see the money in your spending accounts. This makes it much easier to save from a psychological point of view.
   
   
2. Use Rewards Credit Cards - Everyone has to spend money and one way to save money is to use rewards credit cards that offer you gifts in exchange for making purchases. However, be careful not to use one that has an annual fee.
   
   
3. Search Out Deals - Getting better deals from your service providers is often as easy as asking. Competition among cable and phone companies will force them to cut your rates to compete while credit card rates and debt settlements can also be negotiated to lower rates.
   
   
4. Drive Smoothly - Breaking and speeding can add up quickly in the cost of gas for your auto. As a result, driving with cruise control and hot speeding in the city can help you save money on your gas bill.
   
   
5. Use Coupons or Rebates - Coupons and rebates are free ways to save money. A little extra time spent at night clipping coupons can help save a lot of money at the grocery store. Remember, $2 saved is already a gallon of gas or 20 miles or more on some cars!

Consumers aren’t the only ones feeling the credit crunch these days – credit card companies are also hurting for cash. Rising defaults and tighter debt markets have caused credit card companies to make several changes to cover themselves. The most recent: Cutting spending limits on credit cards.

Some consumers may be caught off-guard this holiday season as credit card companies slash credit card limits, often without warning their customers. American Express, Bank of America, Citibank and Discover are among the major credit card issuers taking such actions.

So, who is at risk of having their limits slashed? The first targets will likely be those who have high balances along with those who have low credit scores and are not paying their bills on time. These high-risk accounts can quickly cause problems for issuers if they default.

However, the unprecedented crisis is also causing problems for many consumers with good credit ratings. This means that credit card companies may also begin to target these consumers that they perceive as high-risk in today’s environment. As a result, consumers should keep their balance 30% lower than their limit to reduce the odds of such reductions.

The other key thing for consumers is to check these limits on a regular basis. Accidentally going over the limit on a credit card can spur a substantial amount of fees and charges. Consumers that already hit this wall may want to call up their credit card company saying that they didn’t know it was lowered.

The real estate market is the source of many problems for the U.S. economy and things aren't improving much. The U.S. Centus Bureau released new numbers today showing homes sales that inched higher over August's lows, but remained the worst since 1981 in September. Meanwhile, the prices of those houses have hit 2004 levels as sellers continue to accept lower and lower figures to unload their houses.

Home builders have reduced their production to reduce inventory and stabilize prices, but there were still around 394,000 new single family residences on the market at the end of September. At the current pace, it would take just over 10 months to sell through that inventory and turn the economy. The median selling price for a new home fell to $218,400 from $221,900 in August while the mean selling price was up from $263,900 to $275,500.

It is also worth noting that the true price declines are probably even higher than the numbers. Some 65% of homebuilders surveyed by NAHB reported offering customers free upgrades such as marble countertops. Other incentives include paying closing costs and buying down the interest rates. It is also worth noting that the additional sales occurred primarily in the West; the north-eastern US saw a 21.4% drop while the Midwest saw a 5.8% decline.

Unfortunately, the number of unsold new homes, standing at 394,000 at the end of September, remais near historic highs as the number of US home foreclosures added more properties to the market. In the end, these trends will likely take some time to reverse.

The majority of the costs in our lives are household convenience items that we purchase at a gas station or nearby retailer without regard for cost. The first step in reducing these costs is to keep an inventory of everything in your house to know when you're about to run out, so you have time to run to a cheaper outlet without making a special trip. The second step is to know where to shop to get the best deals. This article will address both of these issues to help you save money!

Step 1: Keep an Inventory

When you have to make a special trip for a household items, there are two big costs involved. First, you are forced to spend the gas money associated with driving to and from the store (not to mention your time!). Secondly, you often end up going to more expensive places for the goods, such as gas stations or small convenience stores. These costs can quickly add up despite the fact that they can be easily avoided through planning - just be mindful of everything in your house and the amounts you have left.

Step 2: Shop Intelligently

One great place to save money is your local dollar store. Dollar stores have many household items that can cost substantially more in a larger retailer. Things like laundry detergent, dish washing soap, hand soaps, mops, silverware, plates, cups and other items can be purchased for merely a dollar. These same items can be 100% or more of that price in other retailers. This may not seem like a lot, but when you purchase a lot of these, you are reducing your shopping bill by 100%+! It adds up...

People often do not realize how much they spend on convenience items and those amounts can add up quickly. Following these simple steps can help you save a lot of money!

Consumers are more depressed about the economy than ever before. The University of Michigan's famous Consumer Sentiment Index fell to 57.5 this month from 70.3 just one month ago! The drop is the single largest in the history of the survey as consumers are finding themselves saddled with debt and unable to pay their bills while costs continue to spiral higher.

The same measure averaged 85.6 last year, but began a steep decline as the economy deteriorated. Tightened credit has led to a further decline in the three-year real estate recession that has caused all of the problems. More and more Americans are finding themselves paying a mortgage on a house that's no longer worth as much as they are paying. Many have therefore stopped.

Foreclosures also continue to rise as Americans simply cannot afford to keep making their housing payments. Banks can't afford to foreclose on these houses fast enough as their own problems continue to mount. Investors who funded these mortgages are no longer interested in making loans. And the market has essentially stopped dead in its tracks.

Government interventions have attempted to free up the market by injecting cheap cash that banks can loan to start making higher interest loans again. However, banks remain nervous as consumers continue to default, even with the cheap credit. The two largest institutions, Fannie and Freddie, are both now owned by the government. There's no end in sight.

However, the storm is always darkest before the sun shows. This terrible economic environment has created a lot of opportunities for investors. U.S. stocks are cheap and many great investors like Warren Buffett are finally stepping up to the plate. Meanwhile, housing prices are at record lows for those looking to buy a new house and lending rates will be cheap when the market reignites.

Consumers should focus on settling their debts now while banks are in trouble and eager for any resolution. They should also be looking at acquiring stocks on the cheap and saving for their future. Now may be a time to rebuild instead of a time to mourn...