Is your budget ready for January?

January is the month most associated with tightened belts among consumers than all the other months in a year.

Very few are the families who enter January financially undented by the December holiday season’s expenses.

January, annually, finds the average consumer already feeling the effects of a strained global economy.

Lara Hodes, who works in the retail sales department at Investec Limited outlined the global environment surrounding the South African economy.

“Consumers have faced several challenges over the past few years. Many lost their jobs or had to close their businesses during the pandemic,” Hodes said. “The cost of living has escalated, while high-interest rates continue to weigh heavily on the indebted. Interest rates are projected to remain at elevated levels for longer, although cuts are expected from next year.”

Hodes shared advice for consumers who find themselves inundated with debt.

“Consumers that are highly indebted need to be cautious not to overspend on discretionary purchases over the festive period,” Hodes advised. “Essential purchases are usually required at the beginning of the year, especially for those with school-age children; provisions should be set aside for these, to avoid plunging further into debt.

“Taking advantage of specials on essential purchases only could offer consumers some reprieve, and perhaps carefully drawing up a holiday budget to avoid overspending,” Hodes concluded.

It’s recommended to time and learn how to draw up practical budgets to manage your wealth. January can be a brilliant time to shop for all the things that were too expensive in December.

Sibusiso Khoza, who works as an account executive in Joburg north, knows a thing or two about shopping right – with a whither eye on all the great deals across the region.

“It’s important to have in mind what product you’re looking for; it’s no use just looking for sales and discounts when you don’t need the product,” Khoza said. “You need to figure out how much the product you’re looking for is, and what’s an actual discount as opposed to a sale on the product.”

Khoza shared his observation on up-selling, and how buy-three-pay-for-two sales are a technique utilized by retailers to guarantee sales.

“When you see this discount which says get-three-for-two, that’s an up-sell; it’s not a discount,” said Khosa. “They’re guaranteeing two purchases of that product and are willing to take a loss on the third product because they’ve already sold those two products, they’ve made the profits.”