Here we are at that time of year when our efforts to live in the moment and breathe deeply combine with marketing pressures from all sides to make our desires to consume triumph. How to breathe through your stomach when you feel like you’re missing out on the bargain of the year? Emails and targeted advertising messages have been capturing our attention for several days, even weeks, several times a day. From “pre-Black Friday” sales, to Black Friday weekend, to Cyber Monday and Boxing Day sales, we may not realize that for two months, 17% year, marketing will succeed many times in convincing us that we cannot miss out on “unbeatable” savings.
Our mind is slyly convinced that by taking advantage of all these advertised sales, we will really save money. Have we forgotten this famous budget prepared at the beginning of the year? Did this foresee all the purchases that could be made under the influence of emotion in the coming days? For those who practice the exercise of keeping a cash budget, cash reserves have certainly been accumulated in anticipation of the costly months of November and December. Thus, it is not excluded to take advantage of the sales to buy what was already planned.
The danger lies in the famous potential savings that turn into overconsumption, which leads, in many cases, straight to debt. High-income households are not immune to this impoverishment, quite the contrary! In their case, overconsumption may not lead to direct credit card debt, but it can sneakily drive them away from their long-term financial goals. Cash is more regular and more important, of course, but without budget monitoring, wanting to take advantage of balances so much, it is savings for retirement and mortgage repayment that can suffer.
We learned this week that only a third of households intend to reduce their consumption for the holiday season this year, while the majority intend to spend more! Despite the inflation, despite the economic uncertainty, there seems to be a need to “catch up” with the last holidays disrupted by the pandemic. A piece of advice that I like to remind you takes on its full importance here: even the best of sales does not represent a saving if it makes you buy something that you do not really need and if you have not planned this transaction.
The ABCs of the informed consumer
Here are some basic reminders to protect yourself against this ongoing marketing attack.
Less is more. If you consume less while the others are shopping, you may have saved less, but you will still be richer… To think about!
Avoid at all costs the use of credit to take advantage of a balance. It is now possible to buy and pay in a few deferred payments: if you buy a good only on the basis of this option, it seems clear that you are buying something that should wait.
Make a list of the items you need. Opt for shopping driven by reason and not by emotions. Your online research will allow you to establish the current price and the minimum discount you want to see displayed to purchase it. Your purchases should be limited to this list.
Analyze the sales of the stores you frequent. Some offer better sales at other times of the year than Black Friday or boxing day. Referring to a specialized publication can also help you make better choices.
Do not deviate from your plan. The advertised deals aim to bring you to the store (physical or online) since it’s a safe bet that when you find that the items on sale are rather limited, you will still buy other items that are not part of your starting selection! Your mission is therefore, if you succumb to a marketing promotion, to buy only the article in question and, if it is not suitable, to return empty-handed.
Shop online to test your cravings. For example, place the items you want in the shopping cart and resist all alerts such as “only a few left” or countdowns in days-hours-minutes-seconds. Then go to bed or go about your business. You will see the next day if what, on the spur of the moment, seemed an absolute need is still so.
Finally, remember that shopping is not a hobby or a sport. This last piece of advice may seem extremely wise and moralizing on this November weekend. But the more quality time we spend with family and friends, the more we take care of ourselves and our loved ones, the less time we have to consume. I personally prefer to accumulate memories than loyalty points on my credit card…