Your Guide to Affordable Holiday Shopping

With just SIX weeks left until Christmas, layaway plans and rewards programs are in full throttle. But to get the best prices, you should hold off on holiday shopping until at least Black Friday, the annual shopping spree that puts retailers in the black for the year.

That’s a big difference from 2008, when retailers midrecession started holiday sales and discounts in October to unload excess inventory. This time around, in an attempt to minimize their losses, retailers ordered more conservatively. With fewer items to sell, they can afford to keep merchandise at full price until the very last minute, and most will until the day after Thanksgiving, says Kimberly Picciola, a senior equity analyst who covers the retail sector at Morningstar.

What’s more, sales numbers right now are on the rise, so retailers have less motivation to slash prices. According to Thomson Reuters, retailers in October reported a 1.8% increase in same-store sales year over year, and nearly every sector had sales gains except for most teenage clothing retailers and department stores. Meanwhile, consumers are starting to choose more discretionary uses for their money; for the third quarter, consumers spent 31% of their spare cash on new clothes (after covering essential living expenses), up from 28% in the first quarter of 2009, according to Nielsen.

Still, in most cases, consumers will get more for their money by holding off on holiday shopping. Here are six tips on navigating holiday sales.

Rather than raising their sales numbers, most retailers are focused on preserving their margins, or the profit they make off of every purchase, says Picciola. To pique consumer interest, they will offer discounts in the 10% range; that won’t spur the volume of sales a 50% to 75% discount would, but by preserving their margins, the retailers make more money.

The recession has been good for the discounters. Year-over-year sales at TJX stores, which include TJ Maxx, Marshalls and HomeGoods, increased 10% for the month of October, while Costco's sales were up 5%.

“Consumers are looking for discounted prices, and these stores are in the position to offer the same merchandise for less money,” says Ivan Friedman, the president of New York-based RCS Real Estate Advisors, which specializes in helping retailers evaluate their real estate portfolios by analyzing their sales figures and underperforming stores.

The first wave of wider discounts won’t kick in until Black Friday, says Friedman. Unless you’re eyeing a specific item that’s limited in inventory and high in demand, you’re better off waiting until after Thanksgiving to find the lowest price.

Expect to see the doorbusters that are typical of that day, especially on consumer electronics, including flat-screen TVs. Consumers are best off waiting until then to start their bulk holiday shopping, he says.