Friday, November 23, 2012, AM | Leave Comment
Black Friday is the day after Thanksgiving Thursday and is the first day of the busiest shopping period of the whole year. That’s the day when vendors of all kinds hope to turn around their possible sales in red for the year into black.
Some economists define Black Friday as not just one day of the year but the starting period of the busiest shopping period until the New Year.
It has been said that one man’s junk can be another man’s treasure. On the same token, the vendors’ black may turn out to be consumers’ red.
Millions of folks get into debt, some heavily, during these shopping days. This is the time of the year when consumers leave emotions in their butt – I mean in their wallet – and their brains in the gutter.
Granted the U.S. economy is based, up to 70%, on consumers spending, but that does not mean they have to get into debt to keep the economy moving forward.
During Black Friday shopping, vendors come out with their best sales and consumers come out with their best credit cards. One hopes to go in black, the other hopes and works really hard to get into debt.
50/20/30 Rule is humongous hoax…
Some financial advisers are promoting the 50/20/30 Rule which states that
50 percent of your take-home pay should go toward essential living expenses like rent and food,
20 percent should go toward financial goals like retirement contributions and debt payments and
30 percent should go toward your lifestyle choices, which are the personal, and often fun, decisions you make about your money. Lifestyle choices often include things like your cable bill, charitable giving, entertainment, hobbies, etc.
I believe the 30% money going towards fun is absolutely non-sense. Let’s say your take home pay is $500 a week which is probably just about the so-called middle class income.
The 30% allocated to fun would be $150 a week, $600 a month. To put in my two cents worth, I think $600 a month out of $2,000 for fun is way too much.
That 30% for fun may very well have been one big reason for many folks’ financial demise. But then again, I come from a third world country and my way of thinking about finance is quite different than Americans’.
At least, I have never lived in debt – except mortgage – whereas millions of American folks are deeply in debt shit and they have problem getting out of it. Many have declared bankruptcy because they could not repay what they had borrowed.
Coming back to Black Friday…
Never go over your budget during these shopping period or any time of the year. Always be in the black. The black (or rather green) happens to be your savings.
The economy is still struggling back to the old financially secured way of life if it ever existed.
In the old days, before the 1980s, many folks considered debt a shameful situation to be in. Credit was limited. Most folks did not have credit cards that they do now. Declaring bankruptcy was unheard off.
Consumers’ spending is a must for the betterment of national economy as long as we in our small personal finance environment don’t go overboard. Many folks go over but then at the end of the day, they curse themselves by spending so much when they receive bills.
In a Nutshell
There is nothing wrong with buying gifts for your loved ones as long as you don’t try to impress others with your spending money. If you do, you would definitely go overboard and will be in debt for months to come if not years.