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Tavis: Tonight, we continue our 'Road to Wealth' series with a look at some of the critical financial decisions we make at the end of the year. Sharon Epperson is the personal finance correspondent for CNBC and "USA Weekend.' Also a former contributor to "Time" magazine and "The NewsHour with Jim Lehrer.' She joins us tonight from CNBC headquarters in New Jersey. Sharon, nice to have you back on PBS.

Sharon Epperson: Thank you. Good to be here.

Tavis: Glad to have you here. So tell me that after a year of bad money management, I can correct all this with a few days to go.

Epperson: You can certainly correct it with a couple of days to go. You can correct it right now. The first thing you need to do, Tavis, is get a financial plan. And a lot of people are scared by that word, and trying to figure out a budget and figuring how much money they have to spend and all that kind of stuff. But really, it just comes down to figuring out how many dollars you're bringing in and how many dollars are going out. And once you begin there, you can really start to develop a financial plan, and build the road to wealth.

Tavis: What's your sense of what people most often are struggling with, scrambling, trying to deal with, near the end of the year?

Epperson: Well, I think near the end of the year and all year round, people are dealing with debt. I mean, people are living with so much debt these days. When you think about the escalating home prices, the type of mortgages people have had to take out to afford new homes or to afford their existing homes, they're really with a lot of that kind of debt.

And then credit card debt on top of it. And we're going into the holiday season, we know a lot of people have been in the stores over the Thanksgiving weekend, buying up all the - Christmas presents and holiday presents that they could. And so they're going to be facing a lot of credit card debt toward the end of the year as well.

Tavis: Are there really things you can do at the end of the year to try to set some of this stuff straight?

Epperson: Well, there definitely are some things that you can do. And one of the things that I always like to tell people to do is, before you start spending a lot of money, make sure you're saving. Make sure that you are putting away money before you even see it. And one of the best ways to do that is to bank some of your paycheck. And if your company has a 401k plan, you should be maxing out on that 401k plan. This year, you can put away up to $14,000 in your 401k plan. $4,000 in an IRA. That's really great, great money, and a great way to save.

Tavis: I saw a story the other day about considering sales tax deductions?

Epperson: Well, that is an important thing with this tax season coming to an end for the year ending December 31st. You have a choice between declaring sales tax deduction, or taking the state income tax deduction on your income taxes in April. And you need to decide what you're going to do by the end of the December.

If you're going to make a big purchase, if you're going to purchase a vehicle or an RV, or gonna do some major rebuilding to your home and you have a big sales tax to pay, you may want to consider taking that sales tax deduction, rather than paying the state income tax. And then if your state has no income tax, it's a no-brainer. You want to take that sales tax deduction.

Tavis: On my radio program I guess last weekend, we were having a conversation about some new rules that the government has put in place with regard to giving money to charity, specifically for Katrina victims.

Epperson: Absolutely. This is a great time, the end of the year of course, to think about giving to charities. And even more so with the hurricanes that we've had recently. And the Katrina Relief Act, that new tax act that you were talking about, allows you to make a contribution that's 100% tax deductible.

So of course, you still want to make sure that you keep receipts. You never know, especially if it's for $250 or more, but 100% as opposed to 50% in the past. If you make a contribution, a cash contribution between September 1st and December 31st, all of that money is deductible.

Tavis: Getting more out of your miles. I saw a conversation on CNBC, in fact, the other day about this issue.

Epperson: Exactly. Because of the higher gas prices, at least the IRS is giving us a little bit of a break. You get to declare 48.5 cents a mile for all the business miles that you've traveled, for the last three months of the year. And that compares to about 40.5% before. So they are taking into account the higher gas prices. And now that gas has come down a little bit, that's even a better bet.

Tavis: Let me go back to the original point you made. I want to just walk through a few highlights of what you've just done now about things that people can do right now, between now and the beginning of the new year. But back to your original point about debt, is it your sense that people are living with more debt now, no matter what class they are in?

Epperson: That's what's amazing to me. A lot of people think well, maybe it's just poor people who are dealing with debt. No, it's the wealthiest Americans also dealing with debt. About 20% of people making over $110,000 a year are rattled with debt. And their debt has increased in the last several years. The statistics that we have are from 2001 to 2003. They amassed about $40,000 more in debt over that time period just in two years.

And these are people at the upper echelon of the social economic spectrum. The reason, again, is because of these higher home prices, more credit card debt and also, it's just more socially acceptable. It's okay to rack up credit card debt, it's not seen as a stigma anymore. Also, a lot of people are spending more money on their children.

Private education for nursery school all the way up to high school. Not to mention having to spend tuition for college. So there are a lot of extra expenses, a lot of fixed expenses that families are having to pay. And this has created really a tremendous debt situation in the country.

Tavis: Let's set aside, Sharon, the notion of it being socially acceptable. If, in fact, people are taking on more debt, given the list that you've just offered now, some of those things are significant. You want your child to have a quality education. And as long as the public education system is challenged, people want to send their kids to private schools.

The American dream is to be a homeowner. We're told all the time the way to accumulate wealth is to be homeowner. Homes cost more money. What I'm trying to get to is, if you are spending money on these things that you really ought to spend money on, to start to leverage some wealth and have a quality education, how does one navigate not finding oneself in debt?

Epperson: Well, this is the tough part. You've got to start from the beginning as early as you can, saving, as well as spending. And that's the problem. Once you've already started to accumulate debt, it's difficult to get out of it. And there are some ways to get out of it and we'll talk about that. But you need to start with savings. And start with a savings plan initially. Make sure that you have an emergency fund. I talked about the retirement saving.

Even more important than that is having an emergency fund of three to six months worth of what your expenses are, your household expenses, so that if something happens, if you have a medical condition, if you get sick, if you're unable to work for that reason, if you lose your job, that you have a cushion to fall back on, that you don't have to then rely on your credit card debt. That you don't have to take out another home equity loan to pay for just everyday expenses. So that's one place to start.

Make sure that you've built up an emergency fund. And the way again to start to do that is to cut back on some of the things - you've got to pay your mortgage. You want to pay for your kids' education. But you may not need to go out to dinner as much. You may not be able to go to the movies. You may need to take some of that money and at least start saving that so that you'll have something for your emergency fund.

If you are fortunate enough to get a raise this year, going into January, take that money, bank that money. Don't spend that money. There are ways. But you're going to have to cut corners along the way to make sure that you don't fall deeper into debt.

Tavis: All right, so for those who are already in debt, we'll come back in a moment to talking more specifically of how to them get out at the end of the year, as we move toward '06. But for those watching right now, as I suspect, I guess most of us fall in this category, who are looking at a busy shopping season between now and Christmas. What's the best advice that you have to offer right now for folk who you know are challenged with what they're going to spend between now and Christmas?

Epperson: Well, you know, what I found extraordinary, reading all the articles about people shopping over the weekend, is the amount of money people are spending on holiday gifts. You know, I personally think the best part of the holidays is being with your family, being with friends, and sharing that kind of good time. And not necessarily spending $9,000, $10,000 on holiday gifts for people who may not necessarily appreciate it all that much.

Or maybe not appreciate it, you know, come March when they're tired of using the Xbox for a little while. So think about gifts that aren't going to cost you a ton of money. Also do some comparison shopping. Even if you decide you don't want to shop on the internet, that's a great place to go to just look at the different prices and comparison shop, and really try to find the best deals.

And also if you do decide to shop online, consider this, a lot of the internet shopping sites are now offering free shipping. So that's another reason why you might want to do it that way, as opposed to dealing with long lines in the stores if you have them.

Tavis: What are the numbers indicating as we speak about what kind of season this is going to be for retailers and merchants?

Epperson: Well, you know, the data that we got today was very mixed actually. The National Retail Federation said that it was up 22% over the holiday weekend. But some other folks that we talked to from, some shopping mall retailers said it was more like 3% to 5%, maybe even flat. So I think it's really a mixed picture.

I think the discount stores did very well. They offered some tremendous bargains. Wal-Mart saw about 10 million shoppers going into their stores before noon on Friday. But then some of the specialty retailers, they weren't as packed. And so you might see a little bit of a difference there with some of those retailers.

Tavis: All right, so if you're in debt and want to start getting out before we even get to 2006, you say what?

Epperson: Well, if you're in debt already, a couple things that you want to do. First of all, you want to control the spending that you're doing right now. And that means probably giving some IOUs maybe for your holiday gifts for the holiday season. Don't buy any of those big ticket items. The other thing that you want to do is see if you can contact some of your credit card companies and talk to them. Actually call them up and say, this is my issue. I may not be able to pay the full balance right now.

I may not even be able to make the minimum, but I want to start making regular payments. They like that. They want your money. They want to know that you want to start paying back on a regular basis, and they may be able to work with you. If you cannot work with the credit card companies, if you're really at a loss, you may want to contact a credit counseling agency. Be very diligent, though, in who you contact. Make sure your check references and call a couple of different companies. And talk to them about what they can do and how they might be able to help you.

They may be able to set you up with what's known as a debt management plan, where you kind of pay them a fee and they help you reduce your debt and possibly get you a lower interest rate on some of your credit card payments. But again, that might be somewhat of a last resort. You want to try to contact the credit card companies on your own first, and see if you can work out a plan with them.

Tavis: She's a personal financial correspondent for CNBC. She's Sharon Epperson. Sharon, thanks for the wonderful insight and good advice, especially this time of year. I appreciate it as always.

Epperson: Thanks for having me, Tavis.

Tavis: Take care of yourself.

Epperson: Bye-bye.

Tavis: Up next on this program, "The Mummy" star, Oded Fehr, out with a new show on Showtime. Stay with us.