EVEN in Mzansi we have Black Friday.
On 24 November, shops encourage people to spend by offering ridiculously high discounts on popular goods – what’s not to love?
But while it is very tempting to polish the credit card while you wait, John Manyike, head of financial education at Old Mutual, warned that those looking forward to Black Friday need to spend carefully. It seems Old Mutual’s Savings and Investment Survey had some interesting facts why.
- In 2014, households spent 15% of their income servicing debt and in 2017, the number increased to 16%.
- 58% of the income bracket earning between R6 000 and R13 999 said their income has not covered their living costs at least once in the last year.
- As a result, 56% of the people who said they could not afford to live on their salaries borrowed money from a friend or relative, and 36% also used their savings. Another 24% paid their bills late or missed payments; 22% took up personal loans from institutions or microlenders, and 36% borrowed from their stokvels.
Manyike shared a few tips with SunMoney to help you to keep track of your money and avoid a financial hangover:
- Don’t be an emotional spender. Always remember your financial goals and remember your budget.
- If you can’t afford it now, don’t buy it on credit.
- Don’t increase your credit card limit to be part of the Black Friday buying frenzy.
- This is an annual event so you can save from the start of next year and be in a better financial position to spend when it comes again.
- Remember: being emotionally committed to your finances will serve you in the end. If you think twice before buying every purchase, you will cut out unnecessary items.
- If you are going to buythings at the Black Friday sale, remember to work out how much you can spare and keep to that budget. Don’t be afraid to keep that calculator close to you and punch in every purchase to see if you are still within your budget.
- Know when to stop!