Black Friday — The Savings May Be Debt In Disguise

DANBURY — Black Friday, otherwise known as the day-after-Thanksgiving shopping day, typically begins the holiday shopping season. Millions of consumers head out to shop the sales. However, many of those consumers will use credit to make their purchases and will not pay their balances in full. Therefore, any savings may be potentially lost to interest charges. In fact, for some consumers, purchases will remain unpaid well into 2005.

To help consumers shop on Black Friday and all during the holiday season, and truly realize the savings, Consumer Credit Counseling Service advises following the tips below:

Map out a strategy. Before leaving home or sitting down to your computer, determine which stores or websites you need to visit to accomplish your gift buying. Commit the strategy to writing and don’t revise. There is no need to tempt yourself by shopping in places that you do not need to. You can’t buy that irresistible item if you never see it in the first place.

Shop with cash or debit. Leave your credit cards at home. When you have spent all of your cash or the money you have budgeted from your checking account, go home.

Know the true cost of credit. Realistically determine how long it will take you to pay off any current balances on your credit cards without adding any holiday purchases. If it will take you longer than three months, don’t charge anything when shopping on Black Friday. The reason is clear when you do the math. A shopping spree of $400 charged on a credit card with an APR of 12 percent and an existing balance will cost you at least $144 in interest charges before you will even start to pay off the original balance.

What to do when plans go awry. Sometimes, even when we plan ahead and know our spending limit, we get carried away during the weekend after Thanksgiving shopping trip and end up at our limit with gifts left to buy. Don’t make matters worse by going over budget to finish your shopping. Instead, look for gift alternatives that are low or no cost.

For more information on managing finances while on active military duty, help with debt problems or other personal financial management issues, contact CCCS at 800-208-2227 or visit its website at www.creditcounseling.org. CCCS credit advisors have helped hundreds of thousands of consumers develop tailored financial solutions to manage their debt and futures.