Mistakes to Avoid this Black Friday
As Black Friday draws closer, shoppers excitedly build lists and recruit team members for maximum deal-snagging success. Meanwhile, businesses plot ways to ensure a healthy profit margin by the end of the shopping weekend.
Last year, shoppers on average spent $300, handing retailers a total of over $3 billion in sales. Looking to outsmart store advertising this year? Beware of the mistakes below and emerge a responsible spender this Black Friday:
1. Spending without budgeting
Without goals or a spending limit, Black Friday shopping can quickly get out of hand. To avoid buyer’s remorse and overspending, set some rules ahead of time. How much money will you allot yourself? What are you allowed to buy? With an idea of how much you’ll be spending, start to save as soon as possible. You can even begin setting money aside as early as September. If you do the majority of your Christmas shopping on Black Friday, you may want to start over the summer. This way you can avoid debt and pay completely in cash.
2. Shopping without a plan
To fully employ this tip, you’ll want to sit down and write out a shopping list. Next, you’ll want to compare ads and figure out which stores are offering the best prices. You may want to prioritize the items you want most and plan to hit those stores first. The key to success is to stick to your plan.
Realize that some of the things you are hoping to buy may be sold out. Unless you plan a second choice ahead of time, resist the urge to buy something on the spot as a replacement. Doing so, you’ll be less likely to buy something overpriced or low-quality.
3. Shopping for fun
You may be the prime example of budgeting and living within your means and therefore you have every right to head into Black Friday and enjoy your allotted fun money. Just be sure you are not spending just to spend. After all, just because you can spend, doesn’t mean you should. Accompany others for the fun affair, but scrutinize every purchase you might make. You can treat yourself a bit and still emerge strong and frugal.
4. Assuming every price is a deal
Retailers know that if they can get you in the doors, they can get you to spend money. They often offer door-buster deals to do so. While these basement level prices might save you money, other products on display will cost you. Be very aware of pricing. Some items cost as much as they do any other day and others cost even more than normal. A nice display and an over-exaggerated price reduction are the ingredients for trickery. Before purchasing ask yourself these questions: Is any other store selling it for cheaper? Is this the regular price or am I saving money? Will the price be reduced again before Christmas? If you intended to buy it and it is indeed a good deal proceed with the purchase.
5. Shopping only on Black Friday
Black Friday can be a great time to pick up handfuls of Blu-rays for next to nothing, but as businesses compete for customers’ attention, they are beginning to hold sales on all sorts of inventory even before Black Friday.
Additionally, in the few weeks after, prices also take a dive as Christmas approaches. Don’t be fooled into thinking Black Friday is the best time to buy everything on your list. Watch prices November through the end of December (don’t forget after Christmas sales) to ensure you are saving as much as possible.
6. Shopping only brick and mortar stores
Online retailers often beat in-store prices. So, before heading out into the crowds be sure and know what’s available online. Some businesses hold off on their online markdowns until Cyber Monday (which can actually start as early as Saturday), but the prices will be advertised ahead of time.
Whether in-store or online, technology can be your deal-snagging friend. Apps such as ShopSavvy not only find cash back opportunities on your purchases, they also can compare prices across multiple retailers. No need to do the legwork yourself. Bottomline: Do your research.
7. Opening store credit cards
An article from Business Insider was so “right on” when it mentioned how big of a mistake it can be to sign up for a store credit card on Black Friday. Store cards can be a good thing when it’s issued by a place you frequently shop with and therefore have the potential to cash in on rewards. They also add to the diversity of your credit which can help you secure student, car, or mortgage loans.
However, store cards should never be used if you don’t have the cash to immediately cover the purchase you make with that card. Besides presenting the opportunity to abuse the credit, these cards also have a dangerously high-interest rate and if you get behind on your payments, the ballooning balance will be difficult to gain control of.
Opening a store card on Black Friday may save you A WHOLE 20%, which likely amounts to $20-60 on the average Black Friday purchase (maybe $300 if you are buying a large electronic with a $1,500 price tag). However, you must ask yourself if it is worth the risk? If it is, is it also worth the credit inquiry which may cost your credit score up to 20 points? If you are buying a car or home in the next year, it is probably better to just say no.
If you do give in to saving $300 on your new TV, be sure to turn around and immediately pay off your balance on your new store card- even with a line of 15 people behind you. Missing a payment on that balance at 25% will eat your savings in a single late fee.
8. Assuming with a great price, you get great quality
If people could dispute the great deals Black Friday offers, there definitely wouldn’t be the same rush to stores that there is come Thanksgiving night. That being said, what can be disputed is quality. Slippers for $2? No brainer, unless they will be falling apart in a matter of months. With every purchase consider its likelihood to last. If you question the quality, it’s probably not worth your hard earned money.
Apply these tips at every turn (or endcap) and you’ll get the most for your money during these upcoming holidays.
Debt Reduction Services, Inc.
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