Looking Out For The Best Deal, Read This!

Time to read: 4 mins | Jul 13, 2017

Stock Clearance Sale!

End of Season Sale!

Independence Day Sale!

Flat 50% Off!

Different tag lines, but a common purpose --- Sale!

With sale season on, you will find different offers and discounts being displayed by different sellers. Be it a shopping mall or an online store, there are numerous sales going on at present. Shops are gushing with customers frantically trying to get the best of these discounts. The Fear of Missing Out (FOMO) often leads and lures shoppers to shop things during such times.

Many of us aspire to buy expensive gadgets, tablets, mobile phones, laptops, home theatres, interior décor items…perhaps almost everything!

But, how do you assure that you are getting the best deal. Should you purchase it right away or should you wait for the discounts and sale offers to make these purchases.

Notably, e-commerce websites have been very competitive in offering high discounts to customers round the year. Moreover, their big annual Sale Offers is something one would not want to miss.

Here are some of the common offers/discounts, sellers announce to get more customers:

Buy 3 Get 1 Free

Buy 3, Get 1 Free offers are indeed luring. Looking at this you might be enticed to buy 3 things, just to get that 1 thing free, irrespective whether you need it or don’t in the first place.

For instance, such offers on pullovers in the month of February, might attract you just because it is on sale. However, note that it is almost the end of winter, at least in many parts of India and you would rather need cotton/linen clothing for the scorching summers.

Don’t buy an additional pair of jeans and jacket just because it offers buy 3 get 1 free. Ask yourself: Do I still need this if it was not on sale?

If you buy something just for the sake of it without assessing your needs, there are slim chances that you will actually use it later, resulting in a complete waste of money.

Flat 50% Off!

There might be large hoardings outside the store flashing flat 50% off! However, many a times it is only on select item, and for the rest, the word "upto" (written in a smaller font) applies, while some aren’t on discount at all. Hence, be watchful what you add on to shopping bag/cart, for it to not pinch your wallet at the payment counter.

Sale season enables you to buy brands and product which you have been aspiring to buy for very long, and moreover save you some money. However, you should understand that a sale is not a reason to ignore less expensive options that you can use more often. Ask yourself, would you still use it as many times if it wasn’t expensive?

Cashback offers

Cashback is an additional feature offered by many Credit Card and e-commerce companies these days. It refers to getting back some amount on your total shopping bill. It’s an extra earning on your total shopping and helps you earn even when you spend.

A lot of e-commerce and e-wallet apps nowadays entice you to Online Bill Payment, book air-tickets, shop and much more by offering a cashback facility. You can use these cashbacks for next purchase or payment. This in a way adds to customer loyalty for the service providers.

Reward and loyalty points

Rewarding buyers with something is a way to make an emotional connect between the buyer and the seller. Many stores offer points for your every spend. These reward points can be accumulated over a period of time and can be reimbursed on your next purchases.

They may also offer special discounts to their loyal customers around their birthdays, anniversaries etc. Thanks to technology, these sellers keep a track of your buying behaviour and preference, which accordingly, helps to send you promotional mails and messages on merchandise of your interest.

These offers can help you save some money and easily get the things you aspire for at a lower price. However, you need to behave rationally and keep your emotions at bay while making the best of such deals.

Do not forget to follow these 5 simple shopping habits:

✔   Make a shopping list
Always make a shopping list beforehand. First, list down all that you need. Then rationally weed out the items which can be put on hold for the next season. Keep a check on the stock well in advance and improvise your list when need be. This will not only help you save money but will also save your time.

✔   Set a shopping budget
Prepare a budget before you hop out to a mall. This budget should include all the expenses, no matter how big or small. All shopping trips must be well planned so as to save on transportation costs. While you pick grocery, ensure that you don’t over buy which may pose risk of spoilage.

Similarly, don’t buy only because others will shop for cheap. Your decision to buy something should not depend on whether there is a sale or not.

✔   Compare prices and offers online
Today, online shopping apps have simplified shopping further by tapping a few buttons on your smartphone or tablet. You can compare the price of the product you wish to purchase on various e-commerce sites and pick the best deal possible for yourself. Keep a watch on price fluctuations and you might hit on good deal. Many a times, prices are decided by the manufacturers and is not dependent on the store (online/offline). You can actually get a better deal for such products in the Factory Outlet of the manufacturer, so consider visiting if you have one in your locality.

✔   Be clear about your priorities
Buy products that you need now or in near future, and not the ones that are less urgent. Understand your priorities and see which of the least important purchases can be pushed ahead to the next Sale season. Often shopaholics tend to spend on less important products, which are on high discount instead of buying something that they actually need now.

For example, refrigerator and air-conditioner models offer good bargain during winter season. Hence, plan your purchases of expensive goods well in advance. Also, if you are sure about a sale is arriving then you can delay your purchase. It makes sense to get something of priority cheaper today on discount instead of paying extra for it next month.

✔   It is absolutely okay to buy nothing in seasonal sales
Spending is just one way to use your money, while saving is another. End of the season and stock clearance sales will continue year after year. Always save first and then spend, because you never know when you might have a rainy day.

If you buy things you don’t need, you will soon sell things you need. - Warren Buffett

While you plan shopping well to make the best of the season sale, it is vital to ensure that your spending habits do not take a toll on your priorities. Remember that if for the heck of short term joy, you let go the bigger objectives in life, then you would be doing harm to the long-term financial well-being of your family.

To avoid or stop being a reckless spender, here’s the care you need to take…

• Determine the amount that you could spend every month
  In order to do this, you need to first list down your financial goals. Thereafter you ought to ascertain when these goals would be due and how much money you would require at the time of the realisation of these goals (keeping inflation in mind).
  
  The next step should be to calculate the amount that is required to be saved every month (taking into account the rate of return on investments). Based on the amount that is required to be saved and invested every month, you should determine your monthly expenditures.
• Plan for your personal expenses in advance
  It is better to plan for your and your family’s personal expenses (such as clothes, accessories, etc.) in advance. Make a budget for the personal expenses and make sure all your family members stick to it.
  
  If you are facing trouble in saving for your financial goals, explain the situation to your family, so that they recognise the situation and work together towards reducing their personal expenses.
• Have a budget in place for household expenses
  Apart from personal expenses, a budget should also be prepared for household expenditure. This budget should include all the household expenses, no matter how big or small. All shopping trips must be well planned so as to save on transportation costs. While you pick grocery, ensure that you don’t over buy which may pose risk of spoilage…and make sure your family doesn’t waste food.
  
  Likewise, ensure that fans and air-conditioners are used thoughtfully and so with telephones and mobile phones; because every penny saved, is a penny earned.
  
  Legendary investor, Mr Warren Buffett has beautifully said - “Don't save what is left after spending; spend what is left after saving” – this should be followed religiously.

By adopting these simple habits, you can get rid of sleepless nights and live a stress-free life.

It is better to cut down on your expenses as far as possible rather than borrowing in order to pay for a kind of lifestyle that is well beyond your means.

Make sure you don’t take more debt than you can handle. You should have a proper financial plan in place. One of the many benefits of planning your finances is that it will show you how your cash flows are structured year on year, and accordingly you will know how much EMI you can afford to pay in the coming years.

As Benjamin Franklin once said, ‘Rather go to bed without dinner than to rise in debt.’ –

Please note, when you shop more getting attracted by offers and discounts, you probably save less and invest lesser. Hence, it is imperative that you save first and then spend. In this way, you can achieve financial security first and then splurge on leisure. This does not mean that you should sacrifice all your wants and desires, but it just means that you must plan for them systematically.

We believe that if you chart an appropriate financial plan and be determined to follow it, then you will not only be able to achieve your financial goals but also enjoy a comfortable standard of living.

Disclaimer: This article has been authored by PersonalFN, a Mumbai based Financial Planning and Mutual Fund research firm known for offering unbiased and honest opinion on investing. Axis bank doesn't influence any views of the author in any way. Axis Bank & PersonalFN shall not be responsible for any direct / indirect loss or liability incurred by the reader for taking any financial decisions based on the contents and information. Please consult your financial advisor before making any financial decision.