Finance Consumer Worthless warranties and more: The major pitfalls festive shoppers should beware of
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Worthless warranties and more: The major pitfalls festive shoppers should beware of

Australians are being urged to be careful about how they spend their money this Christmas. Photo: Getty
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’Tis the season to swipe the credit card.

But as Australians hit shopping strips around the country in search of the perfect gift for the perfect loved one, it’s important to avoid one thing – purchase pitfalls.

Shops – big and little – all use tricks and treats to get us to spend more, and it’s good to know what you’re up against.

A Choice survey found nearly one in five Australians are still being ripped off by purchasing extended warranties, even when they offer nothing more than your legal rights.

Choice rights expert Julia Steward said this was one of the biggest traps consumers were falling into.

“Don’t waste your money on an extended warranty,” Ms Steward said.

“Honestly, in most cases people do it for the peace of mind, but generally consumer law covers a lot of stuff.”

After an annus horribilis, it’s finally beginning to feel like Christmas. Photo: AAP

And don’t always take the retail assistant’s advice – another survey showed that 80 per cent of salespeople were wrong when laying out what they thought were consumer rights in regard to warranties.

“Many extended warranties largely replicate or underplay your existing rights under Australian Consumer Law,” Ms Steward said.

“They’re a sales trick to squeeze more money out of you that ignores your existing rights under the law.”

At Christmas many families buy big-ticket items, like fridges and dish-washers.

Ms Steward said the best thing to do when being sold an extended warranty was to ask a few important questions.

“Ask them ‘what does this give me beyond the Australian Consumer Law?’,” she advised.

“Under the law, the products you buy should be eligible for a refund, replacement or repair depending on the expected lifespan of the product, not what the company says the warranty is.”

Another issue Christmas shoppers could run into is false statements relating to gift cards.

“People need to be aware most gift cards have a three-year expiry date, and only some have no expiry date,” Ms Steward said.

The more informed consumers are, the better decisions they will make during the Christmas and post-Christmas sales rush, she said.

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Online and in-store scams will be running this silly season. Photo: AAP

“If the product doesn’t do what it says it does, you have a right to speak to the store,” Ms Steward said.

Don’t always assume there isn’t a remedy, people should be comfortable speaking to the store.”

Online shopping scams on the rise

There is nothing like being locked down in a pandemic to turn us towards online shopping – and this year triggered an unprecedented boom.

But our new-found click-and-spend habits come with some serious risks – perils we are being cautioned to look out for this silly season.

ACCC Deputy Chair Delia Rickard said online shopping scams had increased 42 per cent this year, and the consumer watchdog is already seeing Christmas-themed cons.

“Scammers create fake websites that look like genuine online stores, offering products at very low prices and victims will either receive a fake item or nothing at all,” Ms Rickard said.

Scammers will also get people over classified websites, like Facebook Marketplace and Gumtree, claiming they will transport the goods – but they never arrive, she said.

“Do your research by checking independent reviews of online stores or the seller’s history on classified websites,” Ms Rickard said.

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