As the festive season approaches, e-commerce platforms are gearing up for massive sales, enticing consumers with flashy discounts, limited-time offers, and attractive deals.
The festive season is also a season of shopping and it’s easy to lose track of your spending. To avoid burning a hole in your pocket, here’s how you can plan and create a budget to keep a tab on your expenses
As the festive season approaches, e-commerce platforms are gearing up for massive sales, enticing consumers with flashy discounts, limited-time offers, and attractive deals.
The Amazon Great Freedom Festival Sale is in full swing with up to 70 per cent discount on beauty and fashion items. The Flipkart Flagship Sale, too started on August 6, 2024 with 50-80 per cent discount on categories, such as smartphones, fashion, television and appliances, smart gadgets and accessories, beauty, sports, food, and more. Fashion portal Myntra also offered discounts of 50-80 per cent off through its ‘Right to Fashion’ sale from August 6-11, 2024 and is expected to come up with further offers during the festive season.
The festive season brings a lot of cheer to customers. However, even for those who are disciplined with their finances throughout the year, the festive season can bring distractions, through flashy discounts, limited-time offers, and attractive deals that blur the lines between needs and wants, and affordability and instant gratification, says Abhishek Gupta CFA, Founder and CEO, Abhiyaan Wealth, Association of Mutual Funds in India (Amfi)-registered mutual fund distributor.
“In India, over 20 per cent of customers struggle to pay their credit card bills in full each month. This leads to hefty interest charges of up to 42 per cent per annum, not just on the outstanding balance but also on new purchases,” he adds.
While it is true that as consumers we all love good bargains, and more so during the festive season when we tend to splurge. However, the lure of bargains could play havoc with your finances and budget if you are not disciplined with your buying. So, it is important that you do not fall into the temptation of buying things that you actually do not need.
So, here are a few ways to ensure that shopping spree during the discount season doesn’t burn a hole in your pocket.
Avoid Impulse Buying: As a first, try not to make purchases on impulse during a sale. To stay away from this, jot down a list of what you need before the sale begins. Try to stick to this and don’t be tempted to add unnecessary items to your cart just because some of the items are available at a discount.
Says Priti Rathi Gupta, founder of LXME, a financial platform for women: “Prioritise needs over wants and avoid impulsive buying during the festive season. We understand that the offers appear to be very appealing, and you may get things at great discounts. However, do remember to follow the 24-hour rule for your wants. Give yourself some time to think whether you actually want to buy this or not, and then decide. This will help you in spending wisely,”
Differentiate Between Needs And Wants: As a first, ask yourself the tough question before buying a product: Do you really need this or do you just want this? Make use of the festival offers to buy things that you actually need.
Says Renu Maheshwari, a Securities and Exchange Board of India-registered investment advisor (Sebi-RIA) and chief executive officer, and principal advisor, Finzscholarz Wealth Manager, a financial advisory firm: “Pay close attention to your budget. Whatever may be the offer, do not go beyond your budget.”
Watch Out For Marked-Up Prices: Brands often use a trick to attract more customers. They inflate the original price of an item before offering it on a ‘discount.’ This makes the discount appear to be bigger than what it actually is. So, do your research before buying a product. Try to do a price comparison and check the price history of the product to ensure you are genuinely getting a good deal.
Go Through The Fine Print: All discounts are not straightforward. While some deals come with conditions, such as the need to spend a minimum amount, some other items need to be bought in bundles to avail of the discount. Also, watch out for hidden costs, such as shipping fees or additional taxes that could inflate the price. You must always read the fine print to fully understand the terms and conditions before making a purchase.
Find Out About The Seller’s Reputation: Not all sellers are trustworthy. So, before making any high-ticket purchases, always find out about the seller’s ratings and reviews. While a low price may seem tempting, it’s important to ensure the seller has a good reputation to avoid issues, such as receiving counterfeit products or facing delays in delivery, exchanges or refunds should you decide to exchange or even return the product.
Be Watchful Of Scams: Typically scams happen a lot during e-commerce sales. Try to be cautious about phishing emails or fake websites that pose as well-known e-commerce sites. Make sure you are always on the official site before entering your payment details. Also, be wary of deals that seem too good to be true.
Make The Most Of Cashback And Rewards: For shopping on specific e-commerce platforms during sales, many credit cards and digital wallets offer cashback or rewards. You must check whether your payment method offers any such privilege. However, do remember to pay off any credit card bills in full to avoid interest charges that could cancel out your savings earned by way of cashback.
Time Your Shopping: While some deals are available throughout the sale period, others may be limited to specific days or times. So, plan your shopping around these “flash sales” to get the best of the deals. However, be aware that the rush during these times can lead to items selling out quickly.
Return And Exchange Policies: Before making any purchase, especially from a lesser-known seller, you must review the return and exchange policies. Some sellers may enforce a stricter return policy or charge re-stocking fees should you decide to return or exchange. Make sure you are comfortable with such conditions.
Create A Budget, Save, And Invest: Create a budget and decide your spending limit. During festive seasons, you generally skip your savings and investments due to high expenses; to avoid that, set aside money for your savings and investments at the beginning of the month so that you do not end up exhausting your money earmarked for investments on a shopping spree.
Says Abhishek: “Plan your festive purchases in advance by saving or investing in short-term fixed deposits or appropriate mutual funds.”
Postpone Major Upgrades: According to Priti, one should ideally consider postponing major upgrades, such as electronics or home furnishings, until the festive season to take advantage of discounts without financial strain.
Avoid Easy EMI Options: While shopping, you may also come across easy equated-monthly instalment (EMI) options. However, Priti says that before opting for such schemes, one should understand all the details, the cost involved, and whether it fits in one’s budget.
“This way, you will avoid unnecessary purchases, as you may end up in a debt trap and can affect your credit score if you don’t pay the EMIs on time,” says Priti.
“Steer clear of credit card EMIs or Buy Now, Pay Later (BNPL) schemes that can lead to unmanageable debt,” adds Abhishek.
While e-commerce sales offer a great opportunity to grab deals on everything, ranging from electronics to clothing, it’s necessary to shop wisely so that you get the true value for your money. By keeping these pointers in mind, you can shop at peace without having any regrets later.