The Super Bowl of Consumerism
Next week is Black Friday. I’ve nicknamed it the Super Bowl of Consumerism. Consumerism, as defined by Investopedia, is “the idea that increasing consumption of goods and services purchased in the market is always a desirable goal and that a person’s wellbeing and happiness depends fundamentally on obtaining consumer goods and material possessions.” Sound like the prevailing mindset of most people today? I think so. In response I wanted to publish this post a week before Black Friday to share some thoughts and ideas before this extravaganza of consumption.
Black Friday is the epitome of the ever increasing culture of consumption in our society today. Just look at how this day has evolved over time. It used to actually just be on Friday. People would line up outside the stores before they opened waiting for hours so they could be the first ones in to try and get the best deals. When the doors finally opened, people would literally stampede through the entrance, crushing one another on their mad rush to the hot deals. In case you have forgotten what this looks like, here is a link to a short clip from some of the stampedes in 2017. It looks more like a European soccer game than shopping to me. People have literally been crushed and died in these mass frenzies. Then people started camping out overnight in front of the stores, sometimes for days. Eventually stores started opening earlier and earlier as they competed for the most shoppers. For many stores “Black Friday” now starts mid day on Thursday, goes through the entire night, and will often continue through the entire weekend of Thanksgiving, beckoning shoppers to consume more and more. And if that wasn’t enough, the shopping gluttony now spills over the weekend into Cyber Monday where you can continue to consume with the click of a mouse or the swipe of a finger.
What are we doing? Thanksgiving is supposed to be a time we give thanks for what we are grateful for. A time to be spent with family and friends, reuniting and connecting. Now society is continually cutting that precious time shorter and shorter so we can feed our ever increasing appetite for consumption. I feel like we are really missing the mark here and it is time to re-evaluate things.
Now, let me be clear that I am not blatantly opposed to all forms of consumption. I like buying things just as much as the next person, and that is of course one of the main purposes of money. In fact, next week I am planning on publishing a blog post about 3 things that I spend money on, and why, so plan to check that out as well. But here are two behaviors that I think we all need to keep in mind and try to avoid this Black Friday before shopping the deals:
Living Beyond Your Means
The first behavior we should avoid is spending money for consumer items when we can’t afford it. Basically, this is living beyond your means. The principle of living within your means makes perfect sense to most of us, yet we often find ourselves violating this basic rule of personal finance. This leads to buying things on credit, which means going into debt, which means we are moving away from financial independence rather than towards it. We are almost all guilty of this at some point. I am not going to pretend I am immune to it either. There are plenty of examples in my past when I have fallen prey to consumerism, having purchased something on credit when I knew I really couldn’t afford it.
Why do we do this? There are likely many reasons. Let’s discuss some of them.
First, credit today is so easily obtained. It seems a day doesn’t go by that you don’t get a letter in the mail or an email offering you a new credit card or some type of loan. Years ago you actually had to have money to pay for something, which meant you had to exercise discipline and save for it over time. Now all you need is a piece of plastic that you can get with one phone call or a few mouse clicks and it gives you immediate purchasing power today that you otherwise would not have.
Second, we have been conditioned to think that debt is normal. If everyone around me has debt, why shouldn’t I? Why shouldn’t I have the things I want to enjoy? I deserve it, right? A little debt won’t hurt, I’ll pay it off soon. Sound familiar?
Third, we give into the feelings of “I want it and I want it now!” As a society, we have been conditioned to expect things immediately and have lost the discipline of delayed gratification. Think about it. How frustrated were you the last time your internet was running a little slower, or you had to wait longer in the drive through for take out, or your Amazon package didn’t arrive within 48 hours. We not only expect, but often demand, that things are given to us right away. It is the same with consumption. If we want something, we want to have it now. And with credit being so easily obtained and seeming so normal, most people rarely exercise the discipline to save up for items they purchase.
Finally, marketing, social media, and the people around us make us feel like we NEED these items, even if we can’t afford it. It seems that everywhere we turn we see advertisements for the latest smartphone, the newest fashions, and the coolest cars. When I was growing up, these advertisements were mainly limited to commercials on TV. Now we don’t just have the advertisements on TV, but also on Facebook, Instagram, YouTube, side banners of every web page you visit (except my blog :-)), and email to name a few. We are literally inundated with marketing schemes to get us to consume more everywhere we look. Plus, we see the people around us buying all the latest gadgets and clothes and driving the newest vehicles, oftentimes purchased with credit. It’s no wonder we feel like we NEED these things. In today’s world we don’t just feel like we have to keep up with the Jones’s, but with the Kardashians too!
Meaningless Overconsumption
The second behavior I believe we need to avoid is meaningless overconsumption. Even when you can afford to purchase consumer goods, buying too much can be dangerous as well. Many people find that with time the amount of money they are spending on consumption purchases tends to increase. They continue to buy more and more, even if they don’t really need the items or ever end up using them much. I call this meaningless overconsumption. We buy more and more things over time that don’t add any significant value or meaning to our lives. This is at the heart of the culture of consumerism.
There have been times when I feel I have fallen victim to this vice as well. If not kept in check, this behavior can also lead us farther and farther away from financial independence.
Why do we do this? Again, there are likely several reasons. Here are some of my thoughts on this behavior.
I believe that one of the primary reasons we buy consumption items is that it’s like a drug. When we buy something new at the store or off of Amazon, we get an instant surge in dopamine levels, just like a drug. It helps us to temporarily escape from the hardships of day to day life. We feel what we perceive to be happiness, excitement, and/or fulfillment. But are these feelings real? Do these things really make us more happy or fulfilled?
What we universally find is that, just like a drug, these feelings are temporary. The high doesn’t last. All of our problems and life situations are still right where we left them. In fact, some of our problems may even be worse if we couldn’t actually afford to purchase the thing we bought.
And just like a drug addiction, the allure of consumption beckons us to return to buy something again and again so we can continue to experience that escape, that high. Furthermore, just like a drug, over time we tend to need an ever increasing stimulus to produce a similar effect, causing us to consume more and more. Thus ensues the cycle of meaningless overconsumption.
There are at least two more problems with this behavior. First is the opportunity cost of what you purchased. By using that money to buy something, you can no longer save and invest that money. You have essentially traded some of your future freedom for that temporary high. Now, if the item you purchased brings true value and meaning to your life, then I believe it is worth sacrificing some of that future freedom. However, if it is for meaningless overconsumption to achieve a temporary high to unsuccessfully fill a void in your life, then it is definitely not worth it.
The second problem is that not only did that item cost you some of your future freedom, it also actually takes away from your freedom today. Whatever you purchased has to be stored and maintained. You have to make a conscious effort to use it. It now occupies some of your mental space/energy and has become a part of your life, whether you realize it or not. This is what is meant when people say that the stuff you own actually owns you.
Five Questions
Keeping these above negative behaviors in mind, I would ask you to consider the following five questions before you begin shopping this Black Friday:
Have I paid myself first?
Paying yourself first is a positive financial behavior I discussed in my post 5 Unconventional Choices for an Unconventional Life. It comes from the book The Richest Man in Babylon and basically means that before you start giving your hard earned money away, you need to pay yourself first. This means setting aside a percentage of your income, usually at least 10 percent or more, for saving and investing. In this way, you are building for your future and keeping your financial priorities straight.
If you don’t have the habit of paying yourself first, this may be a good time to re-evaluate. Why be so quick to part from that for which you have given so much of your time and energy for? Especially if that something you are trading for is of little to no value to you. So before you dive headfirst into any Black Friday sale specials, make sure you pay yourself first and only then spend what may be left.
Can I really afford this?
This is where you need to ask yourself if your personal finances are in order. Are you free of consumer debt? Are you sacrificing future savings or goals to buy things today? Don’t let the marketers get the best of you. They try to convince us that the deals are so good, we HAVE to take advantage of them regardless of our financial position. Don’t fall prey to these tactics.
And if you are free of consumer debt, don’t go into debt buying things this coming weekend. If you do, I guarantee you will ultimately regret it. A few days or weeks of fleeting enjoyment isn’t worth months or years of servitude paying off that debt. Continue to exercise the same discipline that has kept you out of debt to this point. If you don’t have the cash to pay for something, you can’t afford it. Plain and simple.
How much is enough?
How much is enough? Do you really need a newer and bigger TV? Do you really need the latest new smartphone? Or is what you have already enough? Are you sacrificing your future financial freedom to buy things now in areas where you already have enough? Will buying more clothes really add value to your life or will they just add to the pile in your closet that you don’t even fully utilize already? Only you can answer these questions for yourself.
Am I sacrificing more important things to consume more?
The holidays, and specifically Thanksgiving weekend since we’re talking about Black Friday, are a special time to spend with family and friends. Are you sacrificing some of this precious time standing in lines or wandering the crowds trying to save an extra 20% when you could be with those you love strengthening relationships and making lasting memories? You never know if this may be the last time you can ever be with some of these relatives, especially those that are aging or elderly. The time we have to be with our kids while they are still living at home is very limited. This is a fact I have become more keenly aware of as my kids grow up and my two oldest boys are in high school.
Our time is our most precious resource. So if you have time off of work this holiday season, try to maximize the time you have doing what matters most to you, and minimize the time you spend buying into the culture of consumerism.
Is this purchase adding value to my life?
If you are going to spend money this Black Friday, or any other time, be sure to ask yourself if this is really bringing value to your life. If it is, and you can afford it, then great, by all means buy it and feel good about it. That is one of the purposes of money. But if it does not bring more value or meaning to your life, then stop and consider what you are giving up for this purchase. Is this how you want to spend your money, which again is what we trade our time and life energy for?
Conclusion
As the 2019 holiday shopping season kicks off with this upcoming Black Friday, aka Superbowl of Consumerism, stop and re-evaluate things. Don’t fall into some of your past behaviors if they are keeping you from progressing towards financial independence. Consider the following take home points:
- Avoid living beyond your means. If you can’t afford something, then don’t buy it, even if it is 75% off.
- Avoid meaningless overconsumption. Don’t buy things that don’t bring value to your life.
- Consider the five questions I have listed above before embarking on any shopping spree this holiday season.
- If something does bring true value and meaning to your life, and you can afford it, then buy it and enjoy the purchase! I don’t believe the path to FI should be traveled while bound in the shackles of excessive frugality. Remember to check out my post next week to read about 3 things I have decided to spend money on because they bring great value to my life.
Thanks for reading. I hope you are doing well in your progress towards reaching FI. If you have any questions or comments that might help other readers, please list them below. In the meantime, keeping working towards Freedom Through FI!
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