How Much Money Are You Really “Saving” on Black Friday?

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For many of us, Thanksgiving is a time of turkey, pumpkin pie, and quality family time, but the holiday has also become practically synonymous with an entirely different event—Black Friday.

Black Friday marks the beginning of the American holiday shopping season. This period is renowned for its shopping sales and massive discounts, with Black Friday itself being the busiest shopping day of the season for brick-and-mortar retail stores.

Over the years, total spending during the season has only continued to increase. In online shopping alone, consumers spent a record $9.12 billion on Black Friday in 2022, according to Adobe Analytics.

Over this period, it’s very easy for shoppers to convince themselves that they are saving money. However, if an item you don’t absolutely need costs $400 regularly but $300 on sale, you are not saving $100; you are really spending $300 unnecessarily. The average credit card debt per household in America rose 7.9% to $10,170 in the second quarter of 2023, up from $9,245 in the second quarter of 2022. Households in Pennsylvania come in slightly lower at an average of $7, 517.  So, what this suggests is that all those holiday “savings” could actually be harmful to your personal financial situation.

To help protect yourself this shopping season, it pays to understand the mentality behind these sales. Seasoned retailers know all too well how to leverage consumer psychology to make Black Friday deals appear better than they actually are, so here are a few tricks of the trade to be wary of as you reach for your credit card.

Repeated Products and Prices

Many retailers, probably more than you realize, are repeating Black Friday products and prices year after year. This means that product prices promoted as a one-time deal are not, in fact, truly that rare or fleeting. Retailers try to create a sense of urgency to entice buyers, but in truth, shoppers should take the time to do their homework and decide if an item is really worth the money.

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Doorbusters Come in (Highly) Limited Quantities

In retail lingo, a “doorbuster” refers to a deal that retailers hype up to almost an absurd degree. The discounts on such a deal may even seem too good to be true, hence the name “doorbuster”—a deal so great that people will bust down the door to get their hands on it.

While these deals are real, what you might not realize is they are typically only available in limited quantities—very limited quantities in most cases. You can actually see for yourself nowadays, as most retailers disclose the quantity available on such deals in the fine print.

Simple Tips to Getting the Most Value out of Black Friday

Despite all the caveats above, it is still possible to get a good deal out of Black Friday if you know what you’re doing. Here a few simple tips to help you get the most out of your Thanksgiving shopping.

  1. Research prices beforehand: Retailers typically advertise their upcoming Black Friday sales weeks in advance, giving you ample time to do your due diligence. Compare the offered discounted prices not just with competing outlets but also with online retailers (you may get a better deal from ‘Cyber Monday’ compared to Black Friday).
  2. Create a shopping list and don’t deviate: No matter how good a discount on an item is, if you don’t need it, then you will still save more by not buying it in the first place. Know what you want beforehand, create a list, and most importantly, stick to it.
  3. Have a set budget: If you’ve done the research and know which items you want, you should be able to create a Black Friday budget. Once you’ve done so, again, be disciplined and don’t exceed it. If you’re using a credit card, manage it responsibly and make sure that you’re getting cash back.

There’s no reason why you can’t indulge in some holiday shopping, but there is a difference between smart, mindful purchases and indulgences that are detrimental to your finances. So have fun, but shop wisely over the holiday season.

This holiday season, avoid fraud and protect your finances.

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