Karen James is done with her holiday shopping. She started Dec. 26, 2008.

James, 63, of Madison, who is retired, said she begins her shopping the day after Christmas, as soon as the sales begin. She spends about $500 a year on Christmas presents and doesn’t buy anything unless it’s at least half off, she said.

“I have a plan for the year, so that I recognize the opportunity to get a gift when it appears,” James said.

There are going to be more bargain hunters like James this holiday season. According to the National Retail Federation, an industry group, U.S. consumers plan to spend an average of $682.74 on holiday-related shopping this year, a 3.2 percent drop from last year’s $705.01.

The faltering economy factored prominently into this year’s survey. Two-thirds of Americans say the economy will affect their holiday plans this year, with 84.2 percent of these consumers saying they’re adjusting by simply spending less.

People will also be looking for sales more often (55 percent) and using more coupons (41.7 percent). Many Americans will also make changes in gift-giving: buying more practical gifts (36 percent), getting a joint gift for kids or parents (17.3 percent), and making more gifts (16.7 percent).

UW-Madison consumer science professor Cynthia Jasper, an expert in retailing and consumer behavior, said sales are going to be down this season as they were last year. “A lot of retailers are concerned that they’re going to be down this coming year given the severeness of the recession,” she said.

Anna Hansson, 27, of Madison, is crocheting towels and making handbags to sell her friends in order to raise money to send presents to her family in Sweden. She doesn’t give them homemade gifts because they aren’t always appreciated as much, she said.

Hansson’s already spent half her Christmas budget on a $100 pea coat that her boyfriend really wanted. She’s also making him an Advent calendar and may knit him something, she said.

Jerry O’Brien, director of the Center for Retailing Excellence at UW-Madison, said the good news for consumers is that Black Friday prices have been in place in some stores well before the day after Thanksgiving, or the traditional first day of the Christmas shopping season.

Most stores have bought less inventory than prior years, O’Brien said. “So if (shoppers) do see a deal that’s a good value they should take it because it may not be there two weeks later.”

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