Beating Broke

Personal Finance from the Broke Perspective

Avoid Temptation on Black Friday

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November 16, 2006: I See Crazy PeopleIf you’re like almost every other American, after you’ve gorged yourself on all the Thanksgiving day feasts, you’ll be headed out to do a little gorging of a consumer variety.  Black Friday is well known as one of the largest shopping days of the year.  Most every retail store has some huge deals for the turkey-drunk shoppers that wander to their doors.  And, like most every other American, you’ll likely spend way more than you had planned on spending.

 

 

 

 

 

As your favorite personal finance blogger, I urge you to not do that.  I’m all about buying what we need at a price that is below the normal retail price.  Sales, coupons, and rebates are the way to go when buying things that we need.  But, chances are, the things that will be on sale on Black Friday will not be things that you need.  In fact, they’re likely to be things like big-screen televisions, computers, and the hot toy of the day.  You’re going to be tempted to buy them all, because the marketing department makes it look like such a incredible deal!  Here’s some tips for avoiding that temptation, and coming away from your Black Friday shopping with a happy account balance.

  1. Have a budget.  This should be the only tip you need.  But, you’ll get in the store and be tempted.  But, having a defined budget for how much you are planning to spend is still a good thing!  Even if you go over that budget, you’re much more likely to at least stay close to it if you have a budget, than you are if you don’t have one at all.
  2. Make a list.  You’re likely shopping for gifts for everyone, hoping to make them all happy while saving some money on what you buy them.  Make a list of the people you’re planning on buying for, compare it to the flyers that will be inundating your vision over the next week, and then make a master list of people, with the things you plan on buying for them, and where you’ll be buying them.  Now, stick to your list!
  3. Be aware of prices.  Just because the marketing department put the price in big yellow letters over a big red starburst does not mean that it’s really a good deal.  The stores will be full of items that they are marketing as a big savings, when they really are not.  Be aware of the prices of competitors, sure, but also be aware of what the price for that item was last week and be wary of artificial sale prices that aren’t really sale prices.
  4. Don’t fall for the swap.  Many of the places will have a very limited amount of the big sale items on hand.  When they run out, they’ll “swap” the sale item for a similar item that’s more expensive.  You’re there for the big sale item, and you can’t leave without it, so you pay the little bit extra to get the similar item.  Usually, that “swap” item is regular priced, and not on sale at all.
  5. Free can be bad.  More than any other day in the year, the stores will be pushing free items.  “Buy a tickle-me-broke, and get a free tin can!”  The free item is usually a low cost item (loss leader) that they can afford to give away, while the item you have to buy is usually not on sale for as much as they’d like you to believe, and is a much higher profit item.

The biggest thing to remember while you’re doing your shopping next friday is to be aware.  Be aware that the store isn’t out to save you money.  They want to make money, so they will do what they can to bring you in the doors with a huge sale and then sell you all the high-profit items that aren’t on that huge sale list. We’ve all seen the videos each year of the people trampling each other trying to get one of the ten of those super cool kitchen gadgets, or video game systems.  Don’t be that person.  Be conscious of what you want to buy, how much it sold for before, and what the price should be the day you’re buying it.  Have a set amount you want to spend and stay close to that amount.  You’ll be happier that you did.

What are your plans for Black Friday?  Gonna be in the crowds at midnight?  Or wait until it cools off later in the day?  Or, are you a Cyber Monday shopper?

photo credit: Matt McGee

Couponing Doesn’t Need to be Extreme

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Every day, I hear people say that they don’t use coupons because they don’t have the time to go through the papers and mailers and clip the coupons. “It just takes too much time” they say. Those same people, will spend hours budgeting and finding ways to save themselves money, but they don’t see couponing as a viable use of their time and efforts. While coupons may not be as important to your financial health as a budget, they can be just as good as many of the other saving methods that you will employ.

With the popularity of extreme couponing, it’s no wonder that people feel that they need to spend hours each week pouring over newspaper inserts, clipping coupons, then sorting them all into categories and then making plans for where they’ll shop and what they’ll buy. In their mind, they see piles and piles of inserts, and closets full of extra supplies that they’ll need years to use up.

Box o' couponsCouponing doesn’t need to be extreme, though. If skipping your daily latte can be a good strategy for saving a few dollars a day, so can clipping a few coupons. Taking a few minutes each week to flip through the inserts in your paper and clipping the few coupons that you find for the things that you buy regularly can easily save you a few dollars a week. Signing up for manufacturer email newsletters can often result in an electronic coupon to print out once or twice a month. A few extra emails a month is a small price to pay to save a dollar or two.

Now, the thing to remember here is that you aren’t going to retire off of the money you’ll save. And, you certainly won’t be sending your kids to college with it either. But, saving money is saving money. A few dollars here, and a few dollars there all adds up in the grand scheme of things. Heck, maybe you clip coupons so that you can treat yourself once a week to that latte that you’re currently skipping.

Anything that can be done, has been done to an extreme. But, just because the extreme version of something is popular, doesn’t mean that it has to be the only way. Just like there are people who run extreme marathons of 100 miles or more, doesn’t mean that you can’t be a runner. Just because there are hyper-milers who squeeze every extra bit of MPG out of their cars, doesn’t mean that you can’t employ a few of the same methods to save a bit on gas. And, just because there are people who spend hours each week clipping, sorting, and analyzing coupons, doesn’t mean that you can’t spend a few minutes each Sunday to save a few bucks.

photo credit: sdc2027

Flossing with Chest Hair

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Being a frugaler means making some sacrifices.  We sacrifice in order to save a few bucks.  Sometimes, it becomes a bit of an addiction.  We get a small high off of the act of saving.  While you can certainly have worse addictions, even an addiction to saving can be a bad thing at times.

Taking Frugal to Extremes.

Before you get any funny ideas, I really should let you off the hook.  This post isn’t really about flossing with chest hair.  (It’s a catchy title though, isn’t it?)  I don’t actually know of anyone ever having flossed with chest hair, nor would I suggest it.  But, it serves as a good example of a way that people could take saving to an extreme.  There’s a growing movement to do things in a sustainable manner, and using things that are renewable (like chest hair) is a big part of that.  But, there are extremes.  For instance, I’ve read about people who use a special kind of stick that is very fibrous, and they chew on it instead of brushing or flossing.  Some things, I’d just rather pay for.  Being frugal is good.  Being so frugal that you chew on sticks?  I’m not going to judge, but it seems a bit too extreme for me.

Finding a Happy Frugal Medium.

There is seldom a cure to any addiction.  Overcoming one usually entails years of counseling, and hard work on the part of the addicted.  Part of the treatment is usually to completely forgo whatever it is that you’re addicted to.  If you’re an alcoholic, drinking any alcohol at all is forbidden.  But, I can’t, and won’t, condone abstaining from frugality.  Overcoming an addiction to being frugal is just a matter of finding a happy medium where you can still save money, while still living in a way that doesn’t have to include extreme cutbacks.

Thinking..

The Cure to Extreme Frugality.

Without thinking about it too hard, come up with something that you spend money on that you can’t do without.  Again, I’m not going to judge.  For some, it will be their car.  For others, it will be their morning coffee.  Now, come up with something that you currently spend money on that you can do without.  For some reason, for most people, it’s harder to come up with something we can do without than it is something we can’t do without.  Why is that?  The answer is that it’s psychological.  As frugal people, we’ve thought long and hard on ways to save money and to pay off our debt.  In our minds, we’ve analyzed everything that we spend money on.  We then justified everything that we spend.  In some of those cases, we’ve created justification for ourselves so that we don’t have to get rid of something that we would rather not.  So, it’s harder to find something that we know we can do without because, in our minds, we’ve created a justification that makes it something we need.  The cure to finding a happy medium and avoiding the extreme frugal addiction is to take a close look at the things we’ve justified and find those things that we’ve created justifications for that really aren’t all that justified.  In short, stop lying to yourself.  Once you do, you’ll have found several things that you can cut back on, or remove entirely, that will save you money without going to extremes.

It’s just as hard to overcome the addiction of lying to yourself as any other addiction.  There should (and maybe is) be a 12-step program for it.  Until then, try and be truly honest wit yourself.  Understand that you’ll probably slip up once or twice.  That’s forgivable.  Just recognize that you’ve slipped, and get back on track.

photo credit: Just Add Light