Cover story: Spending on empty

Photo credit: Urbanite

By Annie Lok

Special to amNewYork

The mantra during the holidays is “shop, shop, shop,” but for some, the consumer chant is like dangling a drink in front of a recovering alcoholic.

One member of Debtors Anonymous, a group that counsels shopping addicts, said she has a more difficult time controlling her addiction when the holidays roll around.

“A lot of times those urges overcome me, and I want to go and spend, especially now it’s the holidays, I want to get my family everything they want,” said Kathy, also a spokeswoman for the group, which only allows members to use first names when talking with the press.

Shopping addicts have a hard time controlling the urge to spend, because their affliction is often psychological and not just about experiencing money troubles, according to Debtors Anonymous. A shopaholic’s self-worth is sometimes tied to spending on others out of fear of letting them down, Kathy said.

“Friends, coworkers who asked me for money, I would give it to them even if I don’t have money to pay my electric bill,” said Kathy, a 15-year member of the group, which can be found at DebtorsAnonymous.com.

Kathy is an extreme example of the debt problem in the United States. Credit card debt is nearly $1 trillion, four times what it was about two decades ago. Also, with the economy in the dumps, more Americans are delinquent on their payments.“When people lose their jobs or otherwise run into financial trouble, they use their credit cards to pay basic expenses,” said Erik Salazar, a manager at GreenPath, a consumer credit counseling agency in New York City.

GreenPath helps people manage finances but differs from Debtors Anonymous, which is a 12-step healing program that, similar to Alcoholics Anonymous, fuses financial advice with spiritual guidance.

There has been about a 20 percent surge in consumers coming in for counseling at GreenPath during the last few months, according to Sarah Fouquart, a group manager there. The agency sees up to 500 people a week and is experiencing far fewer cancellations than they’d expect during the holidays.

“What we find, there is some reluctance to close the credit cards this time of year,” Fouquart said. “People want to hang on to them for holiday spending.”

In New York, the temptation to shop is in every window — even for consumers who are not members of Debtors Anonymous or involved in credit counseling.

“If you have to buy something — presents, anything — you don’t have a choice,” said Jose Obas, 50, of Flatbush. “You have to use your credit card. There’s just no money.”

The debt spiral is familiar to Jeanette Pearl, 33, of Ozone Park, who has about $10,000 in credit card bills.

“Everyone’s in debt, no matter what age they are,” Pearl said. “It starts at a young age, and as you get older, it gets worse. You have to start getting out of it as soon as you can.”

It seems more people are trying to shake the habit. Members of Debtors Anonymous said they noticed more newcomers, although the exact number in its ranks is unknown.

Rebecca, from Manhattan, has been a member of Debtors Anonymous for four years, and said the organization has imbued her with a spirituality that transcends consumerism.

“I’m not using money to comfort myself, to escape,” she said.

Emily Ngo contributed to this report.

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