Cape Town - With the holidays almost here and retailers pulling out their best tricks to make the most of consumer expenditure during Black Friday, which falls on November 25 this year, debt experts have cautioned against reckless spending.
According to National Debt Advisors chief executive, Charnel Collins, Black Friday was not the biggest discount shopping day of the year, as so many believed.
“There are far better discount opportunities throughout the year. Many retail outlets often inflate prices just before Black Friday to create the illusion that prices have decreased dramatically on the day.”
She also referenced the marketing practice called the “loss leader” approach.
“This involves lowering the prices of a select few items to attract buyers to the store, which often leads to shoppers losing these apparent savings by purchasing other, non-discounted items.”
Collins said there were ways to access deals and save.
“The important thing is to shop wisely and not get duped into buying things you do not need. More importantly, consumers should avoid buying on credit all in the name of Black Friday.”
According to the latest data from consumer credit reporting agency TransUnion, despite overall consumer sentiment indicating a cutback on spend, credit activity has grown.
“Younger consumers are becoming more amenable to buying on credit and thus the debt ramifications are likely to follow,” said Collins.
Collins recommended creating a budget and sticking to it, staying vigilant, avoiding debt at all costs and thinking about “Jan-worry”.
“While there is nothing wrong with the occasional treat and enjoying yourself responsibly, there is nothing worse than waking up in January wondering how you will make it to the end of the month.”
Top tips, recommended by Collins to keep in mind for Black Friday as well as the upcoming festive season:
- Create a budget and stick to it: Make a list of all the items you want to buy and set a corresponding budget, making sure you do not deviate from this plan. Do your research by browsing different stores for the best deals on those particular items - and nothing else. Avoid the impulse buying of items that are not on your list.
- Stay vigilant. With online shopping, be careful of chancers trying to take advantage of the frenzy and scam people into buying poor quality or dubious products. Apply the notion that ‘if it's too good to be true, it probably is.’
- Keep in mind that Black Friday is not only for luxury or non-essential items. Be on the lookout for essential items (like food and toiletries) that you can save money on, especially when buying in bulk. These can be added to your list and factored into your monthly essentials budget.
- Avoid debt at all costs. If you cannot afford to buy an item with the funds you have available, don’t buy it. All too often, consumers turn to credit but this will only lead to you paying much more than the advertised price, thanks to interest and debt servicing costs. Collins advises that the best way to avoid debt is to keep track of your spending and buy only what you can afford.
Think about Jan-worry. Having a pot of savings for January will also ensure that you start your year without financial stress.
Cape Times