Online Shopping And Responsible Credit Card Spending

Spending And Borrowing With Holiday Loans
Part 1 Do You Need A Vacation Loan? – Keep Costs Low
Part 2 Holiday Loans To Help With Shopping
Part 3 Online Shopping And Responsible Credit Card Spending
Part 4 Christmas Loans To Help You Celebrate

Every year, credit card companies make some special offers in the days leading up to Black Friday. You might be offered cash back cards and cards that allow special discounts at certain stores. In addition, many companies tempt shoppers with 0% interest rates for a specified period. So, is it a good idea to open a credit card account in order to enjoy the benefits of discounts and sale prices on Black Friday? In this article we examine:

  • Credit card spending on Black Friday
  • Online shopping on Black Friday
  • Avoiding the stress of debt when shopping
  • How to best manage spending and debt

Spending with a credit card on Black Friday

In 2016, over 17 million Americans were expected to shop either in person or online during the four day Thanksgiving holiday weekend. As retailers extended the sales period over a longer time, consumers decided that it was time to take on more debt and opened up a record number of credit card accounts.

Americans spent less money on Black Friday 2014 compared to recent years

Add to that the increase in store card accounts and payday loans and you can see that, in spite of a decrease in numbers of shoppers, November 2016 was seen as the signal for a resurgence in the US economy.

Credit card debt in the US

In the second quarter of 2017, the average household debt on credit and store cards amounted to $16,883. This staggering figure only applies to card debt and does not include mortgages, auto loans or student loans. The reasons behind the rise in debt are attributed to a rise in the cost of living that has gone way above wage increases and a big increase in medical costs. Interest paid out on credit card balances amounts to over $1,200 each year for the average consumer.

Online shopping on Black Friday

For anyone who has to work over Thanksgiving and who cannot get to the stores before all the bargains are gone, online shopping has been a boon. This kind of shopping also has its own special day known as Cyber Monday.

Black Friday: Online Shopping or in store experience.. according to average spend

In 2005, retailers noticed a large increase in online sales from customers who could not or did not wish to get to the stores. Many online retailers now focus their advertisements not just on Black Friday but also on Cyber Monday. By 2014, Cyber Monday had become the busiest day of the year for online shopping. The easy access to online shopping using credit cards has also created a situation where many people are getting into serious amounts of debt. So, how can you enjoy the benefits of sales and discounts without breaking the budget or the bank?

Tips on how to avoid the stress of debt

Getting caught up in the excitement of a holiday season is understandable and this is when many people spend more than they should. However, there are some tips you can use to avoid the awful feeling when you have spent so much that you cannot afford to buy the weekly groceries or to pay the next electricity bill.

Make a list of what you need or would like to buy and stick to it. Buying something only because it is cheap wastes your money and time.

Everyone has seen the signs. An offer of 75% off is going to make you sit up and notice but if you don’t need it or will never use it, forget it. Make a list of what you really need or would really like and stick to it. Anything that you buy simply because it is cheap is a waste of money and time.

Keep on top of what you are spending with a running total either in your head, on paper or on a smartphone app. Make sure that you have all the receipts so when you stop for a coffee you can see exactly how much you have spent. Ignoring the final total until the end of the shopping trip can make the whole day an absolute disaster.

Decide on a budget and stick to it

Most families have essential bills that must be paid each month. These include things like rent, electricity bills and medical insurance as well as food and drink. The only money that should be included in a Black Friday spending budget is the spare cash that you usually spend on nights out or holiday weekends.

A young woman is shown worried and stress about debt caused by disorganized shopping

You can improve your budget for spending by anticipating the sales and cutting back for a month or two before the big shopping event. Think ahead about Christmas presents and use the sales to help you budget more effectively for the next big celebration.

Think about affordability when shopping

Seriously, if you can’t afford it, don’t buy it. This sounds boring but if you are only just getting through each month by living from one paycheck to another then forget Black Friday. Make sure that all household commitments are up to date and try to avoid the temptation of splurging using a credit card. Disorganized and frantic shopping can only lead to debt problems. Additionally, if you do buy using a card and do not pay off the balance when due, the interest charged over the next few months is going to wipe out any discount you have received.

Look at Black Friday in a different light

The psychological warfare waged by retailers in the run up to Black Friday is enough to tempt an angel. Retailers are fully aware that seeing a large luxury item like a flat screen TV on sale with 75% discount is hard to resist. But, in order to stay on top of your finances you must be prepared to say NO. Stick strictly to what you need and what you can afford and then Black Friday will become an enjoyable experience and not lead to financial problems that are going to put your health and your bank balance at risk in the future.

Spending And Borrowing With Holiday Loans
Part 1 Do You Need A Vacation Loan? – Keep Costs Low
Part 2 Holiday Loans To Help With Shopping
Part 3 Online Shopping And Responsible Credit Card Spending
Part 4 Christmas Loans To Help You Celebrate

About the author

Mark Larsen

Mark Larsen has worked in the finance industry for over 20 years. Over the course of his career, Mark has amassed experience in personal finance and especially short-term lending. He shares his valuable insights on