Budget Hater

Black Friday - Red January

Posted by Aaron Coleman
Nov 27, 2013
For budget guys like me, Black Friday poses a unique set of thoughts.  On one hand, Black Friday represents the best of American Capitalism: The opportunity to shop and spend money on the best deals of the year.  Stores compete against each other trying to one up the latest offer, all in hopes of luring you into their store.   And in the process, you get outstanding deals. 

One the other hand, Black Friday represents the very worst of American Capitalism.  People flat out spend entirely too much money on an increasingly commercialized holiday.  The January credit card bills come due and many people find themselves in a bad place financially. 

The term Black Friday simply represents the day retailers have their biggest day of the year, thus putting their books in the "black" and helping them archive profitability for the year.  But for many, the term Black Friday has come to represent a festive, energetic, holiday experience.  A day that has some camp out all night in front of their favorite store, get up at 2:00 a.m. to drive to the mall, and actually exercise weeks in advance to be physically ready for the big day. 

Don't get me wrong.  I like great deals as much as the next guy.  Black Friday can be an event that can really stretch your hard earned dollars to their maximum potential.  I know many that save all year to make a purchase on this particular day. However, for many, the concept of "saving" for this big day doesn't necessarily compute.  Black Friday quickly turns into Red January...a financial bloodbath that carries drastic consequences well into the following year. 

There is lots of advice out there on how approach Black Friday.  Here are three tips that can help you avoid a Red January scenario and set you up for a successful 2014: 

1. Make a Plan.  Just like you need to create a budget in your everyday spending, you need a holiday spending budget.  Pencil out how many of the dollars you've earned this year to spend on gifts for others and yourself (and let's be honest, Black Friday is mostly about stuff you want...).  Once you have this amount determined, you can create a plan on the best way to spend it.  And by all means, shop the deals.  Get the best possible bang for your buck.

2. Avoid the Impulse Purchase.   Retailers are awesome at getting people to buy stuff they never intended to buy.  "But the deal was so good, it would have been silly not to buy it."  Really?  That good?  Find your deal, stick to your plan and move down the list.  Impulse purchases ruin people. The chaos surrounding Black Friday intentionally draws people into this impulsive desire.  Hold strong!  You are a Winning With Money reader :)

3. Park in the Back.  What?  Yes, park in the back.  Park as far away from the entrance as possible.  This does a few beneficial things for you. One, you don't waste time and gas driving around in circles looking for a good spot and creating needless pollution.  Two, the exercise is good for you.  Three, this gives you time to think.  Instead of getting irritated and upset with Joe Schmoe for taking your parking spot, you have time to think about what you intend to buy and how much you have to spend.  And four, if you do buy something you shouldn't have, you have the time to consider returning it on the long walk back to the car.  

It all comes down to this: Don't spend more than you have this holiday season.  Simplify your approach and your thinking.  Focus on the true spirit of the season and make this December one to remember without sacrificing January to get there. 

 Happy Shopping! 

 Aaron Coleman      

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