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Unpacking topical issues and how they affect ordinary South Africans
By Brett Cameron, Head of Old Mutual Rewards
Black Friday, which takes shoppers by storm on 23 November 2018, is fast becoming as popular in South Africa as it is in the US. Local retailers have welcomed this opportunity to discount and move huge volumes of goods. Online fashion retailer Superbalist reports that last year’s Black Friday was its biggest trading day ever, with over 118% year-on-year growth and sales figures that jumped to double that of 2016.
The annual Black Friday stampede continues to grow. A survey conducted by online website MyBroadband, with 1 583 respondents, revealed that 81% of respondents planned to shop on Black Friday in 2018. On average, they plan to spend between R1 000 and R2 000, with PC hardware, home appliances, clothing and gaming consoles topping the list.
While making the most of Black Friday specials can be a savvy way to save money, it is very important to stay focused on buying only what you really need and knowing what counts as a saving.
Consider this example: If you have been planning to buy a microwave that usually sells for R1000, then taking advantage of a 50% discount on Black Friday means you save R500. However, if you had no intention of buying a microwave and are only doing it because it’s on special, you’re not saving R500, you’re spending R500 you did not plan to. This example is key to understanding Black Friday savings. So resist being swept along by the marketing frenzy and don’t justify a purchase just because it’s on sale.
Understanding money better and building good financial behaviours can help you develop immunity to impulse spending, no matter how enticing the marketing. While Black Friday does offer the opportunity for genuine savings, it can be detrimental to your financial health if you have bad money habits. To develop good habits, educate yourself on basic money management, identify realistic financial goals and be strict when it comes to your budget. To stay on track, reward yourself for good financial behaviour by joining a rewards programme that incentives better money habits. Members of Old Mutual Rewards report that being part of the programme encourages them to consult a financial adviser and to seek out more financial information – two key steps towards spending money responsibly.
Be strategic on Black Friday: go in with a realistic plan and budget, and stick to them. Make long-term financial wellbeing part of your everyday thinking and join a rewards programme that helps you resist temptation and rewards you for improving your financial health.