1. Beware of store cards and rebates.
It's tempting to sign up on the spot for a store's credit card to save an instant 20% off your purchase, but think before you leap. Store cards are profitable for one reason -- the majority of those who get them carry a balance, and the interest rates are sky-high -- 24.5% for Macy's and 25.24% for Sears, according to Bankrate.com.
"That 20% discount costs you a quite a bit in interest if you use the card and don't pay off the balance monthly," says financial planner Derrick Kinney of Derrick Kinney & Associates. "You can set yourself up for a trap down the road." He cautions against going for the deal with the plan of paying it off fast and then canceling the card, because the reality is, that's not what most people end up doing.
Also, don't count on rebates. While there is nothing inherently tricky about rebates, the majority of people simply fail to redeem them, says Kinney. Over $500 million in rebates go unclaimed each year, according to consumeraffairs.com.
2. Exercise your debit card.
"Don't charge Christmas," advises Kinney. "If you can't pay for it on up-front or on layaway, you probably don't need it."
If you must put your purchases on plastic, at least use cards that allow you to rack up rewards and points. Better still, use your debit card. "That helps curb overspending, because if you don't have money in the bank, your transaction is not approved," says June Walbert, a certified financial planner with USAA.
3. Ask for a discount.
Haggle on Black Friday? Absolutely! If you're buying multiples of the same item (DVDs, socks, video games, books) ask the merchant for a "volume discount" and see if you can score a buy-three-get-one-free kind of deal. Or, if you know that a similar product is cheaper elsewhere, see if the store will at least match the price -- or better yet, beat it by 10%.
If you're a student, teacher or AAA member, your affiliations could earn you additional discounts. Be sure to ask, since such discounts may not be advertised, notes Farnoosh Torabi, a personal finance expert on behalf of Chase Ultimate Rewards.
4. Avoid "gotchas."
Beware of shifting policies. Some stores change their rules on Black Friday, including cutting the flexibility of return policies and availability of layaway programs. At Amazon, for example, jewelry purchased on Black Friday may not be returned. And Toys R Us puts its layaway program on hiatus for the day, warns Torabi.
5. Stick to your list.
Before you go to the store or turn on the computer, decide how much you can afford to spend. Commit to that amount and have a list of what you plan to buy. Ideally, you've researched prices. "No matter how good the offer, only take advantage of a sale or coupon if you were planning to buy the item anyway," says Tanisha Warner, spokeswoman for Money Management International, a nonprofit credit agency. "Stick to your spending plan. Little items add up quickly,"
6. Remember that "sale" doesn't always mean cheaper.
Just because the sign says "sale" doesn't mean it's really a sale, explains consumer expert Andrea Woroch, in her round-up of Black Friday shopping strategies. For example, she says, "many stores are advertising blockbuster prices on the Kindle e-reader, but check with Amazon and you'll find there's no difference between the regular and so-called 'sale' prices."
To separate the ho-hum from the really good deals, use pricing tools like Consumer World's Price Checker (to compare prices at many online stores instantly) and DealAlerter.com (to get notified when an item's price drops).
7. Don't trade quality for price.
A low price on a lousy product is no bargain. This year, for example, with cotton prices at an all-time high, some clothing manufacturers are cutting corners. Hems may not be properly finished, sleeves are shorter than normal, and manufacturers are using more synthetic fabrics to keep costs down. Consumer electronics is another area that's rife with cheap knockoffs.
Do your research up front by checking reviews on sites like Consumer Reports. Also, nothing beats reading customer reviews by owners of the products you are thinking of buying. Check Epinions.com, and read the user comments posted after most product descriptions at Amazon.com, suggests Edgar Dworsky, founder of ConsumerWorld.org, on his website.
8. And that goes especially for "free."
Say a retailer is offering a $10 gift card on toy purchases of $75, leading you to add enough items to your basket to hit the magic mark. If you spend more than you planned just to get the discount, that's no deal. Says Woroch, "Sometimes, free isn't really free."
And if all else fails, here's a bonus tip: Just stay home and eat those leftovers.