The Holiday Recession -- A Perfect Storm for Consumers?
Nov. 29, 2009— -- What happens when the economic recession meets the holiday shopping season? The collision between those two consumer storms will create significant opportunities for you to save this holiday season, but you'll have to be cautious.
Retailers will lure you in with the promise of big savings, but businesses still need to make a profit. If you keep a few things in mind when making buying decisions, you'll be more likely to get what you want at a fair price.
Avoid 'GOBS' & 'ASF' & 'NOROE' -- While you might find some great prices at "Going Out of Business" sales, be sure to ask yourself whether you're willing to take the risk of the product not working or falling apart in a month, a week or a day. This goes for every "All Sales Final" and "No Refunds or Exchanges" sale, too.
These products are the legal equivalent of "As Is"... or "At Your Own Risk." No matter how nice the store or whatever the clerk tells you, before you buy, you must be absolutely sure that the product works and is what you need; the discount is rarely worth the risk of being stuck with a product you can't use. I speak from experience, my office doorstop is a 5-pound power drill that wouldn't.
Decide what's important, and get it in writing -- Before you pay, ask for what you want and need. If having your cell phone work at your home and office is important, make sure you write it into the margin of the agreement and that the store manager signs it.
If you know you might have to change your travel plans, get the best price on the trip from your travel agent and then ask them to toss in travel insurance. Not sure whether your dad is really going to like that new sweater from the Big & Tall store? Make sure the sales receipt provides for a full cash refund rather than just a store credit. Even if it's not store policy, ask the manager for the full cash refund anyway.
When times are tight, travel deals abound. While many discounts are advertised, if you know what to ask for, you can get something better.
Hotels will often have better rates than publicized, so even if you already have a reservation, ask if they have a better price. Many times they do and they'll give it to you, if you just ask. Some hotels will also give you a discount if you pay upfront in cash.
Hotels really don't like vacancies. They want those heads in beds, so if you're willing to be a little more daring with your travel plans, some hotels, like the Affinia Manhattan Hotel in New York City, will give you a discount if you make a reservation after 10 p.m. for the same night. You can save up to $100 on your room.
Stay in charge of your money -- In tough financial times, low advertised prices on big ticket items like cars, furniture, and recreational vehicles don't reflect hidden charges in the contract's fine print. You can avoid hidden charges, stealth fees and unplanned interest bumps if you buy big ticket items like you'd buy a house.
For example, while the one-stop shop of a car dealer and loan maker is more convenient, you can save a lot of money if you go to your bank, credit union or savings and loan first and work out loan options with them. Once you've figured out your budget, go to the store or dealership and bargain for the best price. That way, you'll be sure to get the lowest payment and the best deal.
So, what's the bottom line for a holiday recession? Retailers want to make a quick sale, while your best strategy is to take your time. Remember, your consumer power is peaked only while your money is still in your wallet.
Ron Burley is a consumer advocate and author of "UNSCREWED: The Consumer's Guide to Getting What You Paid For."