With Black Friday making it’s appearance this week, it may be time to evaluate this “holiday” and decide if it’s a day we should actually partake in or if it’s just a ploy to push us further and further into debt.
Like the U.S., Canada has become not just a country of big spenders, we are a nation of obsessive spenders, now owing almost $1.6 trillion in personal debt, and that’s excluding mortgage debt.
It’s even gotten to the point where some analysts believe Black Friday is becoming another Boxing Day in Canada. Can we really afford two Boxing Days in Canada?
All of this shopping is contributing to personal debt, at a time when consumer debt load is at or near record levels. Canada’s debt-to-income ratio rose to 164.6 percent at the end of June, from 163 percent at the end of March, according to Statistics Canada. That marks the biggest jump in the ratio since 2011, and it’s now at its highest level on record. That means that Canadians owe just under $1.65 for every dollar of their disposable income. Canadians need to be careful with their consumer spending, even if it is a “good deal”.
If it means a shopper will get a better price on items they would buy at some point anyway to put under the tree, it is not a bad thing for them to join in on Black Friday. A little homework weeks in advance, before the frenzy, helps to sort through what’s a deal and what’s been gamed into looking like a discount. Retailers and manufacturers work to ensure profit margins don’t suffer, a fact surveys of sales and profits bear out.
Richard Feinberg, a professor of consumer science and retailing at Purdue University, says although it’s helped push retailers back into the black – or profitability — since the 1970s, Black Friday doesn’t necessarily provide the best deals.
“In promotions and advertising that begin as early as September, retailers are using key words and phrases that signal holiday shopping for consumers,” Feinberg is quoted as saying in the Purdue News from the Indiana university. “Door -buster sales aren’t just for the Friday after Thanksgiving. They’re for any Friday in October now.”
Getting a great deal on items you were already planning on purchasing should be what Black Friday is about…especially if you find yourself in a money crunch during the holiday season. Before you go out and indulge in Black Friday sales, sit back and think about the items you actually need and what you want and budget accordingly. You shouldn’t put yourself further into debt for a “good deal” on something that is just an impulse buy. Chances are, you will look back on that purchase in the coming months and regret the decision anyway.
