Overheard at the Financial Fitness Fair

Today I helped out at a Financial Fitness Fair at a local high school. What is a Financial Fitness Fair, you might be asking? Well, it’s basically a more realistic version of the game LIFE for high school students. Usually it’s juniors and/or seniors who participate. They start with the idea that we are time-traveling to the future when they’re 22. The students are assigned a job with an entry-level salary and then are set with the task of creating a monthly budget based on that salary. The fair has nine different booths the kids have to visit that cover different expenses like food, transportation, and student loans. It’s a valuable learning experience for the students and I believe the general consensus is that it is much better than going to class.

My friend Paige hanging out at the Clothing Booth.

My friend Paige hanging out at the Clothing Booth.

To give you an idea of what the Financial Fitness Fair is like, hear are five things I overheard today while volunteering:

1. “Why didn’t we have this when I was in high school?” At every Financial Fitness I go to, I hear this from the adult volunteers and teachers. I’ve said it myself like a million times. Before I started working at a credit union, I knew nothing about money besides how to spend it. We learn so much in school, but often times practical skills like how to budget, how to save, or how much college really costs unfortunately get left out. A study done by Learnvest and Chase Blueprint showed that 52% of teenagers want to learn more about money, so the Financial Fitness Fair is a great opportunity for them to gain some of that knowledge. Although we only have an hour of their time, the fair gives the students some basic financial skills that they can build on as they get older.

2. “Dude, I got totally wrecked on student loans though. $50,000 – that’s an outrageous number! Like no one actually has that much in student loans.” I heard a kid say this today after his buddy gave him a hard time about ending up in the red when he finished his monthly budget. And although I agree with him that $50,000 in debt is an outrageous number, it’s sadly not an unrealistic one. The average student loan debt for a four-year degree in the U.S. is $29,000. And if you’re a doctor, like this kid said he wanted to be, that number goes up to $166,750. So his estimated student loan debt was actually kind of low. Too often kids go off to college without really thinking about how much it costs and definitely with no idea of what their monthly student loan payments will be once they graduate. It was interesting to see kids start to understand how much a student loan payment could really affect their future lifestyle.

3. “I don’t need clothes, I’ll just go to work naked.” I volunteer at the clothing booth, where the kids have to figure out a monthly clothing budget for their work wardrobe. At least once at every fair a kid makes this same joke about how they will just save money by going to work naked. High school humor at its finest. I also once had a boy ask me which store I recommended he shop at. “Not like budget-wise,” he said, “but from a fashion standpoint.” This is why clothing is the most entertaining booth.

4. “It’s all about choices, Brian!” I heard a kid say this to his friend today in his best dad-voice. He might have been being sarcastic, but this is actually a really great point. Being successful at the Financial Fitness Fair is really all about making good decisions with your money. When you’re still in high school your parents pay for everything so it’s easy to imagine that you’ll have a ton of money when you’re an adult. It’s fun to go through the fair buying the most expensive clothes, purchasing a Ferrari, and eating out every night. But in the real world, very few people have the budget for such a luxurious lifestyle. At the fair you see kids making compromises in some areas in order to make room for an expense in another, like living with a roommate so they can buy a nicer car. We all have to make those choices in real life, so it’s cool to see them start to think that way now.

5. “This is super helpful. I’m like actually going to save this budget sheet so I can use it when I graduate.”  A student said this to her friend when she was walking away from our booth today and I was like, “You go girl!” It always surprises me how engaged the students are in the fair. You volunteer expecting a certain amount of teenage apathy, but workplace nudity jokes aside, most kids tend to be pretty interested in the activity. It gives you hope that they’ll leave with some valuable information that they can apply in their real lives once they graduate.

If you want to see more about the Financial Fitness Fairs put on at high schools across the state by Maine’s credit unions, you can check out this cool video.

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Oops! Fixing Money Mistakes

We all make mistakes now again when managing our money because, hey, nobody’s perfect (well . . . except maybe Harry Styles but that has more to do with his voice and his hair than any financial skills he might possess). Whether it’s over-drawing your checking account or spending a little too much cash during that night out, we all slip up occasionally. It can be tempting, and frankly easier, to just sweep these errors under the rug. If you don’t acknowledge the problem, it’s like it never happened, right?

WRONG! The key to getting your budget back on track is not to close your eyes tightly and hope the mistakes disappear; instead, try to identify where you went wrong as soon as you discover the error. I came across the following passage in a book recently that sums it up perfectly:

“Tip # 22: Pay Attention Immediately After You Make a Mistake. Most of us are allergic to mistakes. When we make one, our every instinct urges us to look away, ignore it, and pretend it didn’t happen. This is not good because as we’ve seen, mistakes are our guideposts for improvement. Brain-scan studies reveal a vital instant, 0.25 seconds after a mistake is made, in which people do one of two things – they look hard at the mistake or they ignore it. People who pay deeper attention to a mistake learn significantly more than those who ignore it.

Develop the habit of attending to your errors right away. Don’t wince, don’t close your eyes; look straight at them and see what really happened, and ask yourself what you can do next to improve. Take mistakes seriously, but never personally.”

– Daniel Coyle, The Little Book of Talent

So the next time you make a mistake with your money, don’t just brush it off. Identify the mistake right away. Why did you overspend? On what? What made your account go into the negative? And then, figure out how you’re going to stop it from happening again. Maybe you need to adjust your budget or just check your balance on your mobile app before you make a purchase. Use your mistake as a tool to do better in the future.

Choosing a Credit Card Is Easier Than Flappy Bird

If you’re over 18, chances are you get a new credit card offer in the mail almost every day. Visa. MasterCard. Discover. American Express. The choices are endless. Each one promises to have the lowest interest rates, no fees, and an amazing rewards point program.  Sifting through all the offers to find the credit card that’s right for you is like trying to win at Flappy Bird – virtually impossible!

Two is my legit high score. Two.

Two is my legit high score. TWO.

But unlike with Flappy Bird (which you should just give up on playing before you punch your finger into your phone so hard it breaks), there is hope for the first-time credit card applicant. What’s the easiest way to be sure you’re getting a credit card that won’t fee you to death or get you in trouble? Ask your credit union for help! Most financial institutions offer credit cards of their own or have a credit card company they recommend to members. Applying for a card through your financial institution will ensure that you are using a trusted, secure, reliable credit card company.

Once you choose a credit card provider, there’s still the tricky question of which card to choose. There’s “Cash Rewards” Cards, “Travel Rewards” Cards, “Student” Cards, and so many more. They all have different terms, different interest rates, and different gimmicks to get you to choose them. Since your financial institution knows you and your money habits/needs, they can recommend which specific card will work best for you. Unlike a big credit card company, your credit union doesn’t just want to sell you something; they’ll work with you to find a credit card that doesn’t hurt but helps your credit.

Still reluctant to open up the Pandora’s Box of being a credit card holder? Or maybe you’ve already developed some bad spending habits and are working to restore your credit? Whatever your situation, a Secured Credit Card is a great alternative to a more traditional credit card. With a Secured Card you make an initial deposit into a secured savings account of $300 – $5,000. This deposit is pledged as security for your credit card account and will earn interest while you are using your card. You can only spend on your Secured Card as much as you deposited, so you don’t have to worry about racking up a high balance. Additionally, if you get behind or become unable to make payments, your credit card company will use your secured deposit to take care of your outstanding balance.

You can use your Secured Card just like any other credit card – merchants and retailers won’t ever know the difference! And your secured savings deposit guarantees your approval, so you don’t need to worry about being denied because of past mess-ups with your credit.

Still worried that a credit card will do you more harm than good? Here are a few tips for using your credit card wisely:

  • Pay off your balance in full every month. Don’t just make the minimum payment.
  • Limit yourself to just paying for certain things with your credit card. For example, use your card only to pay for gas at the pump. This will keep your balance down and will stop you from impulse shopping with your card.
  • Never pay for something that’s $20 or less with your credit card. This may seem counter-intuitive, but putting a lot of small $5 or $10 purchases on your credit card can really rack up your balance. You can pay for your $3 coffee with cash or your debit card.
  • Put a sticky note on your credit card with your savings goal on it. Say you’re saving up for Spring Break or a pair of concert tickets – put a note right on the card that says “CANCUN!” If you see the note when you pull out your credit card, it will make you think twice about the purchase? Do you really need the item or would you rather save that money for your trip?

Don’t be scared! Getting a credit card doesn’t have to be a scary, grueling experience. Ask the pros at your credit union for help! Now get out there and spend wisely (and just stay away from Flappy Bird. It’s a life-ruiner. It ruins people’s lives.)

The Final Frontier: First-Time Home Buying Part 3!

house 2

In case you missed them, here are the 2 blogs to read before this one:

https://kelseyatcascofcu.wordpress.com/2013/12/03/no-more-barbie-dreamhouse-first-time-home-buying-part-1/

https://kelseyatcascofcu.wordpress.com/2013/12/16/save-save-save-first-time-home-buying-part-2/

Now that you’re all caught up . . .  you’re going to do it! You’ve checked your credit report. Your job is secure. You’ve been saving every spare penny for months. You’ve been staking out IKEA living room sets on your weekends off. You’re ready. You’re going to buy a house.

What now?

Unfortunately, buying a house isn’t as easy as going to Target and picking one off the shelf. So where do you start? Once again I have turned to my good friend Erik the Mortgage Officer, and he helped me come up with these steps for buying a house. Each person’s experience might be a little different and you might not follow this timeline exactly but this should give you an idea of how the purchase process should go:

  1. Determine Your Must-Haves – Although these things might change as you go through the home-buying process, I recommend having an idea of what you want before you do anything else. Make a list of 4 or 5 things that are important to you such as location, number of bedrooms, or style of house. You might need to refine your “must-haves” when you get approved for a certain dollar amount or when you start to visit homes for sale in your area, but these guidelines will give you some place to start. It’s important to be flexible, but you also don’t want to walk into this process blind; having a visual of the end-goal will help you make important decisions along the way. This step is especially important if you have a partner-in-crime for this purchase – what if your significant other wants a 70’s era one-level ranch when you dream of a three-story Victorian mansion?! It will be better to find this out at the beginning of your home-buying journey when there’s time to negotiate rather than once you’re ready to make an offer on your dream-house and your better-half isn’t on board. Save yourself time – have guidelines in place.
  2. Get Pre-approved – The next step is for you to visit your financial institution and get pre-approved for a mortgage loan. Hopefully, you’re going into that office with your best financial foot forward. Check out my previous blogs for tips on how to get your finances ready to buy a house.When you get approved for a mortgage loan, your financial institution will tell you that you are approved for up to a certain amount. For example, you might be approved for up to $150,000. IMPORTANT: this doesn’t mean you have to use that full amount! It just means that is the maximum limit to your spending. If you find a place for less, then that’s great. A pre-approval is generally good for between 60-90 days. Don’t worry if you haven’t found the right place by the end of this period – there’s no penalty for not buying a house during that time! It won’t negatively affect your credit, it just means you will have to reapply. A good tip: don’t do anything that would change your credit during that 90 day period, like apply for a new credit card or buy a car. You don’t want to think you are approved for a certain amount, find the perfect home, and then find out your credit has changed and you can no longer get a mortgage approved for that amount.
  3. Get a Realtor – Oh, to get a realtor or not to get a realtor? That is the question? There’s a lot of debating out there about whether or not you truly need a realtor to buy a house. But unless you are in the housing business yourself, chances are you could benefit from the help of a professional. Navigating the home-buying process is tough, especially if you are a first-time home-buyer! Why go it alone when you can have someone who has been through the process hundreds of times be your real estate spirit guide? The key is to comparison shop. Look at a lot of different realtors in your area. How long have they been in the business? Do they have any references? Does your mortgage officer have anyone they recommend? You want someone with experience who is familiar with the neighborhood you are looking to buy in and who understands your vision for your first home. You can still look at home-listings in your area and request to see certain properties, but your realtor will be able to make recommendations, as well. This is the stage at which you will actually begin shopping around for your new place. Hopefully with you realtor’s help you will find a house that feels like home and you will be well on your way to Step #4 . . .
  4. Get a Home Inspection – Mortgage-Officer-to-the-Stars Erik, told me that this is one step people commonly skip in an effort to save money. But it’s one of the most important ones. Once you find a place you like and think you are ready to make an offer, GET A HOME INSPECTION! If you don’t, you might end up costing yourself more money in the long run. A home inspection before buying could alert you to major problems in your potential new home that are costly to repair. Would you rather spend $1,000 to get a home inspected before you buy it or move in and find out about a $10,000 mold problem? If the home needs small repairs, you might be able to negotiate with the seller to have them fix it before you buy or get the price decreased. If the house needs a lot of work, you might be better to cross it off your list. Doing an inspection can give you peace of mind that the investment you’re making in a new home is a sound one.
  5. Closing Time – “One last call for alcohol, so finish your whiskey, your beer . . .” If you don’t remember that song, you are too young to buy a house. But in all seriousness, closing is the last and final step of this process. Once you find a place you like, your realtor will work with you to make an official offer on the house. This is where the haggling ensues and is when you realize how glad you are that you have a real estate agent helping you out. More than likely, the seller of your would-be home will make a counter-offer aka they will ask for a little more money than what you want to pay. Since we don’t barter or negotiate price very much in our everyday lives, this process is a tricky one to navigate alone. Your realtor can help you decide whether you make your own counter-offer, accept the seller’s price, or walk away from the sale. If you and the seller can agree upon a final price then they accept your bid, you visit your financial institution to close on your new mortgage loan (hopefully there will be no hiccups there because you were a good boy/girl and didn’t do anything that would affect your credit recently), and then you move into your new place and stay up all night celebrating! Yay for you! You bought a house! If your offer isn’t accepted by the seller, you will have to continue your search. It’s ok to be sad and maybe even cry a little, but dry those tears – there’s plenty of houses out there and you will find the right one for you.

My last and final tip for the first-time home-buyer – Don’t be scared to ask for help! If you were going to take up golf, you’d probably take a lesson or two from a pro. Maybe read a few golfing magazine. Watch some YouTube videos about perfecting your swing. Basically, you’d do some research before you went out there and just started wacking your club at balls. Buying a house is no different. Take advantage of all of the resources out there. Ask friends, family, and co-workers for advice. Reach out to your financial institution. No one expects you to be an expert the first time around and your house-hunting experience will be a lot less stressful and more successful if you have people guiding you in the right direction.

Best of luck to all you first-time house-hunters out there! I’d love to hear about your experiences. Please feel free to leave a comment telling me about your journey to your first home.

Save, Save, SAVE! First-Time Home-Buying Part 2

Confession: this series of blogs on buying your first home has NOT been easy to write. Want to know why? Because there is SO MUCH INFORMATION to share. Buying a house is just so darn complicated that is not easy to sift through all of the great tips, ideas, and hints out there to compile the best resources for your reading pleasure. But I will not give up! I will break down the multi-step process of home-buying into easily readable, semi-enjoyable narrative quips if it kills me!

I thought that the next post for this series would be a sort of “how-to” series of instructions of how to work your way through the home-buying process. You read the first post, decided you were truly ready and committed to becoming a home-owner, and now you need to know how to do that. So I tried to write a list of things such as “get pre-approved”, “get a realtor”, etc.

But while I was trying to sort all of that out, I realized that the pre-approval step was about 20 times longer than any other. Mainly because I was trying to cram all of this stuff about how much money you might need saved up for a down payment and other closing costs into it. It simply could not be condensed into 2 or 3 quick sentences. Therefore, I have decided to give saving its own post. So here it goes . . .

You will need to save up a lot of money to buy a house. A LOT!!!

Image

Your piggy bank better be FULL when you start looking for homes.

Here’s a quick run-down of the different kinds of expenses associated with buying a house:

EARNEST MONEY OR DEPOSIT – This is a deposit you make on a home when you submit your offer to the seller. It is used to show that you are serious about purchasing the home. In most cases, the earnest deposit is applied to the down payment if/when your offer is accepted. If you were to back out of the sale, you may or may not get these funds back, depending on the terms of your contract.

DOWN PAYMENT – This is a percentage of the total cost of the home that you must pay when you close on the purchase and attend the settlement. In some cases this can be as much as 10-20% of the total cost of the home. If you were purchasing a $200,000 house, that might mean between $20-40,000. In the case of many first-tome home-buyers, the down payment is lowered to between 3-5% which would make a down payment on the same property around $7,000.

CLOSING COSTS – These expenses are any number of additional fees that you might incur during the purchasing process that would not being included in the mortgage financing of your home. They include things like Real Estate Broker Commission/Fees, Appraisal Fees, Title Fees, Inspection Fees, etc. In general, they tend to be around 3-4% of the total cost of buying your home.

As you can see, buying a house is not cheap. Even if you have perfect credit and have shopped around for the lowest mortgage rate possible, you will still need money in the bank before you can make a purchase.

My recommendation? Ask your financial institution for help! Visit your credit union or bank to speak with the mortgage officer. You can get pre-approved for a mortgage without actually committing to buying a house. What it will do is give you an idea of how your credit looks, as well as an estimate of how much house you can afford. Knowing that number will give you an idea of how much money you will need to save for a down payment, closing costs, etc. If you have enough put away to begin the actual house-hunting process – great! Go out there and start hitting up open houses. But if that amount is still a little out of your reach that’s ok, too. Now you have a tangible goal in mind of how much money you will need to save to purchase your first home. Saving is always easier when you have a concrete goal in mind.

Next up . . . the last (hopefully) step to becoming a first-time home-buyer – going out there and actually picking a house! Coming to the Kelsey at Casco Blog soon 🙂

No More Barbie Dreamhouse: First-Time Home-Buying Part 1

A week or two ago I had some friends visit from out of town for my birthday. Sunday morning we went out to brunch; I was casually enjoying some waffles and bacon when my recently engaged friend (CONGRATS! by the way 🙂 ) asked me if I could write a blog about how to buy a house and apply for a mortgage.

A house.

With a mortgage.

With her fiance.

We are NOT. OLD. ENOUGH. FOR. THAT.

A Barbie Dreamhouse is the only home I am interested in mortgaging (especially if it’s the one with the elevator) in the near future, though I think a lot of girls my age probably outgrew those a long time ago.  At 25 my friend and I definitely fit into the “First-Time Home-Buyer” category and are probably ready for homes we can actually live in.

barbie dream house

Once I calmed down enough to actually think about writing this post, I realized how complex of a question she was asking. How the heck do you buy a house? I have shown many a member into our mortgage officer’s office since I started working at the credit union. But other than the fact that he eats a lot of Ramen Noodles while listening to Justin Timberlake, I know absolutely nothing about what our mortgage expert Erik does or how he gets people into their new homes. So he and I chatted and he gave me these tips for first-time home-buyers.

First things first, you should be familiar with the 4 C’s of Credit. These are the main factors that will determine your ability to get a loan.  When you go to a credit union, bank, or mortgage company to get approved for a home loan, these are the things they will consider.

CAPACITY – What is your ability to repay the loan? Do you have a job or another income source? Do you have other debts? Lenders love when you are a Steady Freddy in terms of your income. They are looking to give loans to people who have had the same job for at least 2 years, who are likely to see an increase (even if it’s small, incremental raises) over the next few years, and who are therefore likely to continually be able to make payments.  I know I personally have had 3 different jobs in the last 2.5 years, which isn’t unusual for someone my age, but which doesn’t make me seem very reliable to lenders.  Experimenting with jobs to find your passion is great, but it might mean that your income is inconsistent, you might have to relocate frequently, and it might even mean that some day you won’t be able to make your mortgage payment. Lenders don’t want to stop you from finding your dream job, they just want you to do that before you find your dream home.

CHARACTER – Will you repay the loan? Have you used credit before? Do you pay your bills on time? The Catch-22 of credit is, you have to use it to have it. If you’ve never had a credit card or made a loan payment in your life, you have no credit history and therefore won’t be able to get a loan on your own. Having student loans, car loans, credit card balances, etc. only weigh you down if you have trouble consistently paying off balances and making payments.  If you religiously pay-off your credit card balance each month and make loan payments in full, you are probably in really good shape because you can prove to lenders that you can be depended on to make payments.

COLLATERAL – If you fail to repay your loan, is there something of value that you agree to forfeit? No one wants you to default on your mortgage loan (aka not be able to pay it), especially not your lender. If this unfortunate event were to occur, they want to know that lending you money isn’t a total loss, meaning you have something of value that they can take in place of you paying back the loan. In the case of a mortgage loan, the collateral would be your home.

CAPITAL – What are you worth? Do you have other assets, such as a savings account, car, or certificate of deposit that could be used to repay the debt? Even if you are able to get 100% financing for your mortgage (which means the loan would include 100% of the cost of your home), you will still need a solid nest egg before you are able to buy. Having money in savings means that you have access to funds to pay your mortgage if your income were to become unstable.  It also means that you will able to pay for closing costs (fees for processing the paperwork of your home purchase) and other unexpected expenses in the process of buying your home.  Lastly, it shows that if you were to default on your loan and not make a payment, you have something of value that the lender could use as collateral.

Now that you’re familiar with the general way in which  lenders will assess your credit, figure out the specifics. Visit https://www.annualcreditreport.com for your free annual copy of your credit report. You won’t get your actual credit score number (that costs money) but you will get your credit history from the 3 major reporters: Experian, Transunion, and Equifax. This way you will be able to check the information on your report, dispute any errors, and try to reconcile any unpaid debts you were unaware of. If your credit needs help, you will know before you look to get pre-approved to buy a home and you can give yourself time to improve your credit. Need help understanding the information on your credit report? Visit your financial institution. Here at our credit union we are more than happy to spend a few minutes helping you look through your credit report. Or, check out the “What To Look For” section on annualcreditreport.com. They give some good advice, too.

Last minute check! If I haven’t scared you away from every buying a home with all of my financial mumbo-jumbo, you might just be committed enough to make the big purchase. Here are 2 final questions to ask yourself before you start the actual home-buying process?

1. Why do I want to own my own home? The cliche answer is: because it’s an investment. We all know that renting is a pure expense; you can pay your rent for years but you never actually own the home you live in. Home-ownership is great because there’s an end in sight. Once you pay-off your mortgage, you OWN the house. But why is that important to you? Is it more important than being able to travel abroad a couple times a year? Is it more important than being able to strike out on your own and start a new business any time you get a good idea? We don’t live in the 17th century any more when you had to be a land-owner to be able to vote or do anything cool. Erik said he often gets people in his office applying for a mortgage loan just because they think it’s the “next step after marriage.” Don’t let peer pressure get to you – if you’re happy in your rental that’s ok! If you’re young but dream of leaving your small one-bedroom for a place of your own even though none of your friends are home-owners, that’s fine too! Just be sure you’re buying a home because YOU want to, not because you think it’s what you should be doing.

2. Can you pay for everything going on inside your home?

Once you stop renting, YOU become the landlord. Can you pay to clean your furnace, get new tiling in the bathroom, repair a light fixture, etc. Can you pay to furnish all of your rooms? Your old hand-me-down furniture from your apartment might not look right in your brand new home, but can you pay to get a new couch, kitchen table, beds, bedding, light fixtures, kitchen supplies, chairs, and more all at once? Buying the actual house is one expense, making it liveable is another. If you don’t want to spend a chunk of your paycheck every month at Lowe’s, reconsidering owning your own place might be a good idea. If you’re Mr. Fix-It and can’t wait to decorate, you’re ready for the next step in the home-buying process.

Coming to the KelseyatCascoFCU Blog soon . . . I’m ready to buy a house – WHAT NOW?! In my next blog I will give simple steps and tips for how to get pre-approved for a mortgage loan, how to shop smart, and what to expect at a closing.

Black Friday: Ready or Not, Here It Comes!

According to all of the ads on TV, Thanksgiving is no longer a holiday. It is now Black Friday Eve.  It has simply become the mark of the beginning of Christmas shopping season. If you are a big Black Friday fan and prefer to get your shopping done early, you might be okay with this.  But for me, all the hub-bub about Black Friday seems silly. Is anyone really saving that much money? Are the deals on toys, electronics, and clothes really worth getting up at 2 am and foraging your way through the crowds for? I have never been shopping on Black Friday and ever since I read a terribly sad article about a part-time worker at a Long Island Wal-Mart who was trampled to death by Black Friday shoppers back in 2008, I know I probably never will.

Despite the heavy advertising for the event, it seems that more and more Americans are on the same page.  A survey done buy NerdWallet.com revealed that only 12% of consumers will be doing the majority of their shopping on Black Friday this year.  Apparently most of us have decided we would rather enjoy our turkey in the company our families on Thanksgiving instead of gearing up for a shopping spree.

But there is an upside to early shopping.  The National Retail Federation says that Black Friday shoppers spend an average of $300 with about 30% savings. If you’re willing to put in the effort, Black Friday deals could really help you keep your holiday budget in check. So here are 3 important things to keep in mind if you will be braving the crowds next week:

1. PLAN AHEAD – Black Friday can get crazy.  Shopping on this day is not for the weak of heart. You need a battle plan.  Check ads in your local paper before hand and use websites like TGIBlackFriday.com and RetailMeNot.com to find out where the best deals are for the items on your list.  Those websites even provide mobile apps to help you navigate stores while you are on the move.  Make a plan ahead of time for what stores you will visit, what items you are purchasing, and a timeline of where you will go and when.  This will help you keep your cool in the stampede of shoppers and avoid unnecessary, impulse buys.

2. FOCUS ON ELECTRONICS – Forbes.com claims that the best deals on Black Friday are always for electronics.  Unlike toys and jewelry who’s prices tend to drop 2 weeks before Christmas, things like TVs, gaming consoles, and smart phones tend to be at their lowest price on Black Friday.  So if you have any digital gadgets on your shopping list, Black Friday is the day to get them.

3. FOLLOW THE 40% RULE – This shopping strategy can help you make sure you are actually getting items at a bargain price.  If an item is not 40% off or more, it’s not worth your time; it will probably be available somewhere else for less.  So if it’s not at least 40% off, don’t put it in your cart! The only exception to this rule? Stores that don’t typically have sales.  Some retailers are always discounting items (think Kohl’s or Walmart). But others, like Ray-Ban, Prada, or Patagonia, hardly ever discount merchandise.  If these retailers are advertising discounts on Black Friday take them, even if it’s not a full 40% off! Chances are you won’t see that bargain price again.

One important thing to know before you rush out in your pajamas in the early hours of the 29th – 70% of Black Friday door-busters are available online, according to Forbes.com.  This means you could stay home and get the same prices on your laptop that you would elbowing your way through the mobs in store. It’s definitely something to consider before you hit the road to shop.

With that in mind, here are 3 Cyber Monday Tips:

1. SHOP SECURE HTTPS:// – Only use familiar, well-known websites while online shopping.  Legitimate sites will have https:// (the “s” is for secure) in the URL. If the business doesn’t have a phone number or physical address listed on the site, it might not be a real business.  Scammers will create dummy websites and fake online ads, often promoting discounts on popular items, to trick shoppers into giving them account information, credit card numbers, and other personal info.  Be wary of any e-mails or online ads from unknown retailers that promote huge discounts on merchandise.  If the price sounds too good to be true, it probably is.

2. REVIEW IT – When using a marketplace style website (sites that use multiple vendors like Amazon, E-bay, or Etsy) check the customer reviews before buying a product.  Buyers often rate the quality of the item they purchased, how quickly it was shipped, what shape it was in, how easy the vendor was to deal with, etc.  If the vendor seems trusted and reliable, go ahead and buy the item.  If the reviews are bad, chances are something will go wrong, so avoid those items no matter how big of a discount they’re offering.

3. KNOW THE RETURN POLICY – Before buying, check the website’s return policy. You want to know what your options are if the item doesn’t get to you on time, gets damaged during shipping, or the recipient doesn’t like it.  If it can’t be returned, you’ll want to know that before you pay.

Happy Thanksgiving and Best of Luck to all Black Friday Shoppers!