Knowing the difference between what you ‘need’ and what you ‘want’ will help you make mindful choices this Black Friday. Picture: Freepik
The shopping season is in full swing, with anticipated ‘discounts’ and various Black November sale frenzies going on.
However, consumers need to ensure that they end 2023 on a high note and avoid going into the new year in debt.
According to the recent Eighty20/XDS’ Credit Stress Report, consumer credit defaults continue to rise, while statistics from the National Credit Regulator’s Credit Bureau Monitor show increases in the number of credit-active consumers quarter upon quarter.
The number of consumers with impaired credit records increased from 9.88 million in June 2022 to 10.02 million in June 2023, while the number of consumers classified as being in good standing dropped from 17.19 million in December 2022 to 17.03 million in June 2023.
These figures highlight the importance of being financially responsible in the face of Black November’s tempting marketing gimmicks that are being displayed as actual "deals."
Wikus Olivier, managing director at CreditSmart Financial Services, shares five ways consumers can practice being mindful with their money.
Know your current money situation
Safeguard your financial health by taking stock of your current financial situation. An overall view of your finances will give you an idea of whether you should shy away from inviting "sales" this month or how much you can spend on Black Friday.
Specify your budget amount
Ensure that you have drawn up a separate Black November/Friday budget before doing any online shopping or visits to the shops. Be disciplined and stick to the amount that you have allocated in your budget. Focus on your ‘needs’ and not your ‘wants’.
Farzana Botha, Segment Solutions manager at Sanlam Savings, breaks down the difference between a need and a want. A need is something vital, like your home and food for your household, while a want is something nice-to-have, like a daily take-out cappuccino or a bought lunch.
Pause before making a purchase
Before committing to buying something, take a minute and ask yourself, Is this item essential? Or am I still within my budget if I buy this item?
Do your research
Knowing what items cost before Black Friday will help you point out if an item is actually a discounted deal or not.
According to Olivier, consumers need to keep in mind that retailers tend to raise prices above the usual asking price and then market aggressively to create a false sense of urgency and cloud their judgement, so they will buy impulsively.
Don’t spend money at all
Olivier said that consumers should be mindful with their money and avoid accumulating debt by not taking part in the consumption chaos of Black Friday altogether.
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