“Low Prices You Can’t Beat!”
“Best Deals Out There!”
Lately, these are the kinds of promises we’re seeing plastered on every shop window and computer screen. And while Black Friday is over, Cyber Monday is well underway. Both infamous days have become synonymous with incredible bargains and mall scuffles but they’re also becoming known for another reason: huge opportunities to overspend.
The Myth of a “Good” Deal
The notion of Black Friday sales has become legendary but now there’s reason to believe it may be more akin to a myth. While huge price cuts seem like a great deal, that 60% off sale is likely an illusion of savings rather than an actual bargain. To ensure a profit, sales are constructed by retailers to make it appear like you’re getting a bargain. It works like this: items are originally given an inflated price, then they’re marked down to reflect what seems like a much lower price. That means the sale TV that was marked from $900 to $500 dollars wasn’t worth $900 to begin with.
How to Avoid Temptation: Retailers are savvy to the spending habits of consumers during the holiday season and mark their items accordingly. Look carefully at the before and after price comparison. For example, $5 off of a $95 item is a relatively small savings. Even a 50% reduction on a new coat or vacuum cleaner means you’re still paying the other 5 percent. Focus on the amount that you’ll be spending rather than the amount you’ll be saving. It’s more difficult to justify a purchase when you’re saying, “I’m going to spend $500,” compared to saying, “I’m going to save $50.”
If you’re worried that by walking away from a deal you’re walking out on an opportunity to save, just consider that unless the item is entirely free, you’ll be spending money. And if bought on impulse, it’s likely money you weren’t planning to spend. That equates to more money out of your wallet rather than more money saved.
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Quick Spending is Easier Than Ever
Before Cyber Monday even existed, shopping and deal hunting was done in-store. But nowadays it’s easier than ever to compare prices and shop deals online. Smartphones have made it even more convenient by bringing the ability to bargain hunt right to your palm. The increase in coupon and deal searching apps for smartphones adds another level of accessibility – but these apps also add even more exposure to temptation. While some of these programs can help you to check prices against one another, others only introduce you to deals on items you might have avoided before.
How to Avoid Temptation: Items bought on impulse are, by definition, bought on “a sudden wish or urge that prompts an unpremeditated act or feeling.” These splurges don’t often fit in with careful planning of a monthly budget. The best reason to buy something is because you need it and you’ve budgeted for it. If you know you’re hard-pressed to pass on what seems like a good bargain, then avoid the temptation to begin with. That means staying clear of sales racks and resisting the urge to browse deals online. You’re almost always guaranteed to find something that you want, but focus your energy on the things that you’ve planned for.
Sneaky Marketing Ploys
In addition to ease of purchasing power, consumers are always at risk for marketing ploys that encourage extra spending. The holiday is about giving, but you might find yourself tempted to throw a gift (or two) into your basket for yourself. With 2 for 1 deals left and right, and home good items like appliances and electronics marked with red sale price tags, it can feel like the perfect opportunity to buy that bigger TV you’ve been wanting at a 40 percent markdown. Retailers are well aware that consumers are vulnerable to the appeal of a good deal for themselves even when they’re out shopping for their friends and family.
How to Avoid Temptation: It’s not unreasonable to wait and buy something on sale if you’ve been budgeting for the purchase. Paying for a washing machine at a reduced price is better than paying full price. But take the time to weigh whether you’re buying an item because you need it or because it’s just too good a deal to pass up. Take a minute to ask yourself simple questions like:
“In a year, will I be using this?”
“Have I actually done the research?”
“Am I only upgrading something that I already have that’s still functional?”
All of this cautionary advice doesn’t mean that you have to lock away your debit card or go on a month long spending fast. But being wary of marketing techniques and really questioning whether a sale item is a good deal is one of the best ways to protect yourself against overspending.
Image Credit antwerpenR