With inflation and the rise in cost of living, many people expect Black Friday 2022 to be somewhat subdued compared to years in the past. Experts predict that retailers will have excess stock, start sales earlier and end sales later. Increased prices and interest rates will make shopping more expensive for customers who plan to use credit cards for their holiday purchases.

This can make taking out a Black Friday loan for shopping tempting for some people, but the decision to borrow money shouldn’t be taken lightly. You can apply for a Black Friday loan and get your hands on cash in a few days or even hours, but that doesn’t mean you should.

Before you take out a personal loan for Black Friday shopping, you should know your approximate costs and the potential risks.

Holiday shopping statistics

  • On average, people spend $430 on Black Friday.
  • People save an average of 24 percent by taking advantage of Black Friday deals.
  • Around 155 million people shop during Black Friday.
  • Americans spent almost 9 billion online during Black Friday in 2021, with 43 percent of purchases made on mobile devices.
  • In 2021, businesses made somewhere between $30 billion and $40 billion in sales.
  • 49 percent of Black Friday shoppers think that jewelry is the most discounted in-store item, with electronics following close behind.
  • 62 percent of shoppers think Black Friday is a scam and involves too much consumerism.
  • Slightly more men shop on Black Friday than women, and men are more likely to think Black Friday has good deals.
  • Gen Z shoppers are predicted to have the highest percentage of Black Friday shoppers by generation.
  • 60 percent of shoppers say they regret buying something after Black Friday.

What are Black Friday loans used for?

Black Friday loans are personal loans that consumers use to buy big-ticket items that typically go on sale or are in demand on Black Friday. Some shoppers also take out Black Friday loans for furniture or electronics they don’t have the funds to pay for or to purchase the bulk of their holiday gifts.

Because even bad credit loans can have lower APRs — annual percentage rates — than some credit cards, a personal loan could be a more affordable option in the long run.

What are the risks of taking out a loan for Black Friday shopping?

Taking out a Black Friday loan does come with risks. To better manage the risk around your shopping, it can be helpful to understand what to expect.

Holiday shopping cost statistics

Over the past year, inflation has caused many prices to rise. Here are inflation changes for common Black Friday purchases.

Industry YOY change in cost
Apparel 5.27%
Appliances 5.20%
Computers and smart home devices -0.28%
Furniture 12.22%
Jewelry 2.89%
Toys 2.16%

Your credit score will determine how much your loan costs in the long term. You can get a loan with a lower APR if you have a better credit score. Some APRs may be lower than you can get with a credit card, as the average credit card APR is 19.14 percent.

Credit score Average personal loan interest rate
Credit score
Excellent credit (720-850) 10.3%-12.5%
Good credit (690-719) 13.5%-15.5%
Average credit (630-689) 17.8%-19.9%
Bad credit (300-629) 28.5%-32.0%

Opening any type of personal loan will create a hard inquiry on your credit report, which can temporarily lower your credit score. Make sure you understand how opening a Black Friday loan can affect your credit score before applying — especially if you’re looking to take out a bigger loan like a car loan or mortgage around the same time.

Spending statistics

Several factors may impact Black Friday shopping. The war in Ukraine could influence supply chains, but people may also be willing to spend less with the rising inflation costs. The current unemployment rate is 3.7 percent — a relatively low rate that bodes well for the number of shoppers.

Sales are expected to stretch through November and December, so shoppers don’t need to immediately leap at every deal they say. To save money, consider taking advantage of any loyalty programs you are a part of and knowing what deals to look for in advance.

Younger generations report that they are the most likely to take advantage of holiday sales.

Generation Percentage planning to shop Black Friday sales
Gen Z 75%
Millennials 63%
Gen X 45%
Baby Boomers 38%
Silent Generation 23%

It is interesting to note that the demographic most likely to regret their purchases is Gen Z, which had the highest percentage of people reporting they planned to shop. People of all generations should be cautious about their spending to help avoid buyer’s remorse.

Unexpected costs during the holidays

Don’t forget that unexpected expenses could make it difficult to pay off your loan, especially during the holidays.

  • There are an average of 160 million Christmas tree fires a year, causing around $10 million in property damage.
  • Medical visits from knife injuries, burns, falls, car accidents and food issues add up to an average of 250 injuries a day during the holiday season.
  • Robbery and personal larceny increase by 20 percent during December.

Getting a loan to pay for Black Friday shopping could be a sign that you are living a lifestyle you can’t afford. “If you have to borrow to hit the stores — on Black Friday or any other day — then you are spending beyond your means,” said Greg McBride, CFA, Bankrate chief financial analyst.

Take a look at your budget, see what you can afford to spend and operate within the mindset of your budget. If you’re determined to use a Black Friday loan, have a plan to pay it back.

Black Friday loan alternatives

If you’re considering a Black Friday loan, try out alternative ways you might check off your holiday shopping list:

  • Sell items or get a part-time job: “Consider purging unused items like old cell phones or clothing to sell,” says Lacey Langford, an accredited financial counselor. “Getting a part-time holiday job is another way to earn extra money for the holidays. Plus, if you get a job at a retail store, you can use your employee discount to save on purchases.”
  • Get a side hustle: Like a part-time job, a side hustle is another way to earn a bit of extra money. Earning extra income can help you have extra money for Black Friday deals without blowing up the rest of your budget.
  • Zero-interest credit card: Another alternative to consider is a 0 percent APR credit card that lets you avoid paying interest on purchases for a limited time. Some of these cards also let you earn a sign-up bonus and rewards for each dollar you spend. Make sure you pay off the balance before the introductory period is over because these cards tend to carry higher interest rates.
  • Start saving now for next Black Friday: One way to prepare for the holidays is to set up a savings account or sinking fund to plan for next year’s holiday shopping season. “The holidays come at the same time every year, so they shouldn’t sneak up on you,” McBride says. “If holiday shopping is that important, set aside money regularly throughout the year so you can pay cash when the time comes.”
  • Build a shopping list before you go Black Friday shopping: Saving 40 percent on something you don’t need is a waste of 60 percent of your money. Retailers are good at convincing you that you need something you don’t. Making a shopping list of what you plan to buy can help keep you from impulsively spending more than you can afford.
  • Make sure Black Friday deals are actually deals: While there’s no doubt that there are amazing Black Friday deals that are truly “once in a year,” those are usually extremely limited. Most Black Friday sales are discounts, but not much more than you can find on other sales throughout the year. Know the prices for the items on your shopping list and what makes for a great deal.

The bottom line

Black Friday loans are readily available and easy to apply for, but that doesn’t mean they’re a smart option. Take the time to figure out if there is another way to cover holiday gifts that won’t involve taking on new debt. If you do have to borrow, have a plan to repay your loan in a reasonable amount of time.

If you fail to take those steps, you could have to pay off Black Friday deals for years to come. When you tack on the interest and fees you’ll pay, the savings won’t be worth it.