As we start to get closer to the end of the year and the festive season looms near, we can feel the holidays are almost upon us.
“But this end-of-year festive feeling comes with several adverts encouraging us to spend money, and every day we see more and more adverts encouraging us to spend more and more money,” says Ester Ochse, Product Head, FNB Integrated Advice.
“What is also happening is that the spending festive season starts earlier each year, now being November and specifically, Black Friday. What was traditionally a day of sales has now turned into a month of sales.
“You cannot go into a store or onto a website without seeing the latest specials. While it is a good time to shop around for a bargain or two, it is also very easy to get caught up in the hype and fall into the trap of overspending.”
Ochse says, as much as it can be a good time to get a good bargain and buy something that you have had your eye on for a while, here are a few tips to help you to financially navigate Black Friday:
1) Define your budget
Have a look at how much you can comfortably afford this season without having to buy on credit. Be cautious – it will stand you in good stead later on. Once you have determined your budget, stick to it and do not get swept by the excitement of the spending season.
Remember that you can easily keep track of your budget via the FNB Smart Budget on the FNB App. Download the FNB App and set limits on nav»Money Smart Budget.
2) Have a today, tomorrow and next week limit
This is a very simple way of stopping impulsive purchases. Work out what your limit is for today, being the amount that you would feel comfortable spending without a second thought. This is normally a small amount, say R50, and if the item is below that, buy it.
Then work out what your limit for tomorrow is; this is a higher amount, so you will need to think about the purchase a bit more. This could be between R50 and R500, and if the item is between those two amounts, think about it overnight. If you still want it the next day, buy it. Then the next week’s limit is normally a larger amount, say about R500.
If the item is more than that, think about it for a week. If after a week you still want it, buy it. You will need to think about what limits will work for you; they could be lower or higher. But make sure that you have the money available and try to avoid using credit to fund impulsive purchases.
3) Make a list and stick to it!
We have heard this before but consider it sage advice nonetheless which requires a bit of discipline. And as referenced in the point below, write the research prices down as well.
When thinking about shopping during this time, think of the following points: what things do you need for the home, for example non-perishable groceries and stationery for kids next year. But remember to stay within your budget.
4) Do your research and shop around
Do your research on how much the item normally costs. Then compare that to the discounts being advertised to ensure that the price is really discounted. This is a vital step in the process to make sure that the bargain that you are getting is actually a bargain.
Look at the various retailers’ websites as well as brochures that are published at this time and then compare the various retailers.
5) Use loyalty or rewards programmes
Use your loyalty and rewards programmes to your advantage. Look at where you will get the maximum benefit when using loyalty programmes by the likes of Checkers, Clicks, Engen and eBucks.
For example, FNB customers get an extra R2/l back in eBucks when they use their Virtual Card to purchase fuel at Engen and make one online shopping transaction in a month and will earn double eBucks rewards on grocery spend at Usave/Shoprite/Checkers until 31 December. If you are looking to travel, you will earn 10% on Quick Bus tickets if you book via the FNB app, you can use the earned eBucks to supplement cash flow in January.
6) Investigate warranties and return policies
When buying technology or appliances, ensure you understand the full terms and conditions of the warranties. Also, if you are buying presents or clothing, check the return policy and if there are any time limitations.
7) Shop safely
Ensure that you are shopping safely and securely this time of year. Either shop online using your virtual card on trusted platforms or swipe your card instead of using cash. When shopping online, make sure that you use your virtual card or that the website that you enter your details into has HTTPS in the address bar and only use reputable websites for online shopping. Remember not to give anyone your PIN or your online banking details.
Another great way to protect yourself is to make sure that you have your bank message or inContact activated, this will alert you immediately if there has been any unauthorised activity on your account.
Black Friday is a great opportunity to pick up a bargain and buy a few things that you have been looking at for a while. However, follow the tips above to make sure that you do not regret the money you have spent down the line.