With Black Friday on November 26, many retailers have already begun advertising their discounted offers on goods. Customers grab TVs for sale during Black Friday shopping. Debt counselling practice, National Debt Advisors (NDA) chief executive Sebastien Alexanderson has encouraged consumers to be vigilant when considering the cost of their Black Friday purchases, especially those who would not be paying for their items in cash.
DURBAN - Debt counselling practice, National Debt Advisors (NDA) chief executive Sebastien Alexanderson has encouraged consumers to be vigilant when considering the cost of their Black Friday purchases, especially those who would not be paying for their items in cash.
With Black Friday on November 26, many retailers have already begun advertising their discounted offers on goods.
Last year, many consumers took to social media to express their dissatisfaction with the pricing methods of many retailers, with some coining the term “Black Friday scams” in reference to the frenzy.
In some instances, prices were inflated prior to the date, before being lowered again for Black Friday, therefore depriving consumers of a real savings benefit.
Certain media outlets have already begun formulating price-comparison checks for this year’s Black Friday and have noted that several brands and retailers are guilty of this artificial inflation.
Alexanderson urged consumers to tread carefully, especially if they are not paying cash for an item.
“South Africans, like the rest of the world, are tired and drained after another hard year of the pandemic and its consequences.
“One can understand the human need to buy something which will either bring some joy to oneself or a loved one. The problem arises when consumers who have access to credit, use it rashly or without a complete understanding of its full costs, payback terms and conditions,” said Alexanderson.
In the previous year, he said, consumers opted to load their grocery cupboards with everyday necessities, as well as spending money on big-ticket items, such as home appliances. Yet many either used their credit cards, or even accessed a personal loan to pay for these purchases.
NDA conducted research where the costs of a purchase using a credit card for Black Friday shopping was assessed. Taking into consideration the varying interest rates and repayment terms, there was a clear indication of a lack of savings on Black Friday over any other normal day, when credit purchases are made.
Alexanderson pointed out that a television priced at R5 000 cash, could eventually end up costing nearly double the amount when paid for through a personal loan.
“South Africans are notorious for being poor savers. This has undoubtedly been exacerbated by the pandemic. However, it makes sense to rather save R500 monthly over a period of 10 months, to be able to afford that same television, than accessing credit and possibly paying more than double for your purchase,” he added.
In addition, he cautioned about the dangers of slacking on instalments on credit agreements.
“No one wants to end up over-indebted and in need of debt relief solutions, because of Black Friday purchases. Consumers need to seriously consider all the costs and implications of using credit for Black Friday purchases,” said Alexanderson.
He warned consumers to be careful not to succumb to advertising hype that could leave them spending money that is not at their disposal.
“We need to play our role in stimulating the economy, but not at the expense of our own personal and financial well-being.
“If you are already struggling to make your debt repayments and don’t have enough money available for everyday living expenses, then the rule is simple – if you didn’t need it before it went on sale, you don’t need it when it goes on sale,” said Alexanderson.
THE MERCURY
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