Hello shoppers!
Black Friday is one of the most exciting shopping days of the year! Flash sales, doorbusters, and deep discounts on everything from gadgets to gifts are everywhere. Last year, American shoppers spent almost $10 billion online, and with in-store purchases included, U.S. retail revenue surpassed $20 billion in just one day.
While these numbers highlight the allure of Black Friday, they also remind us of how easy it is to overspend. Spending sprees can leave your emergency savings in shambles if you’re not careful.
Let’s dive into how to enjoy the shopping season without jeopardizing your financial health. Whether you're an employee looking to safeguard your savings or an employer aiming to support your team’s financial wellness, you’ll leave with practical advice to help you shop smart.
Why Emergency Savings Matter—Even During Black Friday
Emergency savings are your financial safety net. They’re there for life’s curveballs—unexpected medical bills, urgent car repairs, or job transitions. Yet, many Americans don’t have enough set aside.
- According to a 2022 Consumer Financial Protection Bureau report, 39% of Americans had less than one month’s income saved for emergencies.
- Worse, 24% have no emergency savings at all.
These numbers remind us how critical it is to avoid unnecessary withdrawals from savings, especially for non-essential spending like Black Friday shopping.
The Black Friday Spending Frenzy: A Double-Edged Sword
Black Friday is a masterclass in consumer psychology. Retailers create a sense of urgency with countdown timers, “limited stock” labels, and unbeatable discounts.
According to CNBC, in 2023 alone, U.S. consumers spent $9.8 billion online on Black Friday, up 7.5% from 2022. Average spending per shopper reached $480, driven by electronics, home goods, and apparel.
However, while these numbers reflect the enticement of sales, they also show the risk of overspending. When people drain emergency savings or, worse, dip into 401(k)s to fund purchases, they create long-term financial stress.
Balancing Spending and Saving
Black Friday doesn’t have to be an all-or-nothing experience. You can enjoy the excitement of great deals while staying true to your financial goals. Here’s why it’s essential to strike a balance:
Holiday spending is rising, with Americans expected to spend $201 billion on gifts and nearly $300 billion on travel in 2024—substantial increases from 2023. At the same time, many are still carrying debt from previous seasons, with 28% of last year’s gift buyers using credit cards still paying off those balances. Financial stress is also widespread, with 55% of shoppers reporting stress related to holiday expenses.
But it’s not all bad news. You can take control of your finances during this high-spending season by planning ahead and keeping your emergency savings intact.
The best deals aren’t worth it if they jeopardize your financial security. Overspending today can lead to months—or even years—of financial stress. Your emergency savings are for real emergencies. Think hospital bills, car repairs, or job transitions—not the latest gadget at 50% off.
Avoid debt traps. With 74% of shoppers expected to use credit cards this holiday season, it’s crucial to set a budget and stick to it.
Stats to keep in mind as you shop:
- 39% of Americans are planning to shop on Black Friday, but trends suggest many are cutting back, opting for fewer or less expensive gifts.
- The average shopper this season plans to spend $925 on gifts, but consider reducing this number by prioritizing meaningful over materialistic purchases.
Balancing your holiday spending with intentional saving can reduce stress and avoid lingering financial regret. Remember, the best gift you can give yourself is peace of mind and financial security.
Tips to Stay Financially Savvy This Black Friday
Here’s how you can enjoy the deals without financial regret:
1. Set a clear budget: Before you even open your browser or head to the mall, decide on a spending cap. Look at your monthly income and expenses. Allocate a portion specifically for Black Friday that doesn’t touch your emergency fund.
Pro Tip: Use a budgeting app to track your spending in real-time.
2. Shop with a purpose: Write down the items you need—not want. Think of gifts, essentials, or upgrades you’ve planned for months.
3. Avoid buy-now-pay-later traps: Buy-now-pay-later services might seem convenient, but they can lead to overspending. Stick to upfront payments whenever possible.
4. Compare prices: Use price comparison tools to ensure you’re getting the best deal. Remember, a discount isn’t a deal if the price was inflated beforehand.
5. Resist impulse buys: Retailers design Black Friday layouts and online ads to tempt you with last-minute additions. Stick to your shopping list.
6. Pay with cash or debit: Using cash or a debit card keeps you from overspending and avoids credit card debt. Plus, it forces you to be more intentional about every purchase. This is a great time to use the money saved up in a Christmas Club if your employer offers payroll deducted savings.
7. Think long-term: Ask yourself: Will I still value this purchase six months from now? If the answer is no, walk away.
Employers: Supporting Financial Wellness During Black Friday
Employers have a unique opportunity to step in and support employees during high-spending seasons. Here’s how:
1. Encourage emergency savings contributions
Black Friday is a great time to remind employees about the importance of emergency savings. Better yet, creating a Christmas Club through Sunny Day Fund can help them save throughout the year to be financially prepared for this time next year instead of racking up credit card debt.
2. Offer financial literacy programs
Workshops on budgeting, debt management, and holiday spending can make a real difference.
3. Provide a company match
If your organization offers an emergency savings program, consider matching employee contributions up to a certain percentage.
4. Communicate often
Send reminders to employees about the risks of overextending their finances and provide practical resources to help them stay on track.
Shop Smart, Save Smarter
Black Friday is exciting—it’s the unofficial start to the holiday season and a chance to snag incredible deals. But the joy of the season should never come at the expense of your financial health.
Employees: Stick to your budget, protect your emergency savings, and think twice before indulging in impulse buys.
Employers: Encourage your teams to make financially sound decisions and support them with the necessary tools and resources to succeed.
Remember, the best deal is the one that leaves both your wallet and your peace of mind intact. Happy shopping!