Experts Say These Are the Worst Times of Year To Make Big Purchases
Consumer spending patterns play a major role in how much we pay for goods and services. When demand spikes, prices usually follow. While this applies to purchases of all sizes, the impact is usually felt most with big-ticket items.
"It varies by product category. When demand is high, inventory supply can become scarce and manufacturers and retailers are less likely to discount or run sales," explained Sarah Fournier, vice president of sales at Opia, a creative sales agency.
Before moving forward with a big purchase, experts recommend avoiding these times of year when prices tend to be highest.
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Early in the Year
"Early in the year, when people get tax refunds, it's not the best time to make a big purchase, since it's hard to find deals," Melanie Musson, finance expert at Quote.com, wrote in an email. "When people have money, sellers raise the purchase price because they can afford to pay more."
Additionally, it's often harder to find deals because shoppers are recovering from holiday spending. This typically leads to a drop in retail traffic. Retailers also try to clear inventory during the holiday season and won't have as much available on shelves at the beginning of the year.
"The 'New Year, New Me' purchases are sometimes driven by emotion and not logic (think about the dusty Peloton bike by February)," Fournier wrote.
Summer
"Summer is another slow season in retail. People are traveling and their minds are on things besides shopping, so retailers don't always see summer as a good time to put effort into attracting customers with good deals," Musson explained.
And with summer comes sunnier days, which can lead to splurging on items you may not need.
"These lift spirits and serotonin levels (which affect mood); studies have shown that customers are willing to spend a little more on nice days," Fournier added.
Holidays
"The worst times to make big purchases tend to be during major holiday sales like Black Friday and Christmas," explained Joanna Clark-Simpson, head of consumer research and marketing at PissedConsumer.com. "While it may seem like a great time to buy because of the discounts, retailers sometimes raise prices beforehand to make the promotions appear more attractive."
Clark-Simpson also pointed out that an abundance of discounts during the holiday season can lead to impulse buys and limited stock.
"In fact, 46% of consumers prefer to shop outside of major shopping events, and 8% prefer to shop after the holidays," she noted. "Shopping outside peak periods can often lead to better prices as retailers clear out seasonal inventory and adjust to demand."
Shipping charges can also be higher at this time of the year.
"Shipping costs during the holidays are often elevated, which is passed to the customer," Fournier wrote.
'Peak Need' Season
"The overarching rule is that it's best to avoid 'peak need' seasons," Fournier explained. When demand is high, prices often go up as well.
Here are some specific purchases you should avoid, according to Fournier:
January: Steer clear of gym equipment
February: Stay away from jewelry due to Valentine's Day markups
After the Super Bowl: Prices on television start to climb
Winter: Avoid snow blowers and luggage due to the holiday and spring break surges
Spring: Lawnmowers are in high demand
Summer: Avoid AC, boats, real estate, bikes, camping gear and grills
This article was provided by MoneyLion.com for informational purposes only and should not be construed as financial, legal or tax advice.
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