Introduction
The financial advisor in me gets concerned on Black Friday because I know how recklessly people spend. This isn’t to say Black Friday is bad. In fact, it can be a great time to buy quality items on sale that you had BUDGETED to buy full price. This, however, requires ignoring the hype, planning, and spending intelligently. Let me illustrate this by explaining how I bought a new a new TV for R779 on Black Friday.
The Process
1. Save ahead of time
Financially astute people avoid impulse buying and save for big purchases. As such, my wife and I saved and set aside money for a new TV. We also had accumulated “Discovery Miles” over the year by earning points for certain behaviours and integrating certain products which we had earmarked for spending on “luxuries”.
2. Only Buy Quality
As a general rule of thumb, my wife and I try to only buy quality from preferential brands as they last longer and usually work better. In this case, we wanted to buy a Samsung TV because we trust the brand quality and it integrates easily with our devices.
3. Use Rewards
We decided to use the Discovery Miles that we had accumulated over the year as Takealot accepts Discovery Miles as payment and was running TV specials for Black Friday. In addition, Discovery was offering a 30% boost on Discovery Miles spent at Partner stores on Black Friday, meaning the value of our Miles would be worth 30% more on Black Friday.
4. Don't use Credit
The final point is to try avoid using credit. Credit is money that doesn’t belong to you, and costs you in interest. Therefore, using money you don’t have doesn’t make sense because you aren’t really getting a special as it costs you in other ways. We used money we had saved (money that belongs to us) to buy our TV for Black Friday.
Final Outcome
Value of TV: R 8 499 (taken from Official Samsung site)
Takealot Special: R 5 499 (Black Friday)
Accumulated Miles: R3305 (33046) 30%
Miles Boost: R1416 (14162)
Total money owing: R 5 499 – R4 720 = R 780.
Takealot Special: R 5 499 (Black Friday)
Accumulated Miles: R3305 (33046) 30%
Miles Boost: R1416 (14162)
Total money owing: R 5 499 – R4 720 = R 780.
Conclusion
On days like Black Friday, it’s important to exercise financial discipline and not buy unnecessarily simply because items are on “special”. Money is a numbers game and by being intentional and deliberate with your saving and spending, you can take advantage opportunities that others may miss. Do it repeatedly and over time this value compounds.
*This blog post is for educational purposes only and does not constitute financial advice. It is an account of my own personal experience and is in no way designed to promote any particular product provider or company.