The Financial Inelasticity We Attain, In A Bid To Spend Wholesomely.
January is usually a month of consciousness reevaluation because this is when the reality of one's financial situation begins to dawn or get clearer. Why is this? Most people are subconscious spenders in December and this is because this is mostly one month where people throw in the towel and go against all their financial principles.
The reason for this is that December is generally a celebratory month, so even people who hardly celebrate Christmas would still find themselves relaxing their financial standards and principles just to enjoy the thrill of working and saving from January to November. People who are retailers in countries where there are no price regulations are always trigger-happy
Scarcity & Price Regulation
This means that price is always like a trigger to them, they pump it by generally studying the mood of people. Because a lot of people want to have fun and relax with their families during Christmas, they're generally met with slightly inflated prices.
Apart from the fact that excessive demand can drive the price of goods and services during festivities, retailers tend to add their increase too and blame it all on the general demand and scarcity that ensues. For example, the price of some goods and services in Nigeria will be inelastic and two of those products are rice and petrol. These are the two most sought goods and services.
There are mad millions to be made
This is because people would travel at all costs, hence the price Inelasticity, then people would eat rice at all costs. However, the way people demand for these commodities, makes marketers and retailers plus other middlemen trigger-free.
So they capitalize on excessive demand to create artificial scarcity and when this scarcity hits a particular apex, they then begin to hoard this produce at their disposal to make the money they want. December is generally a competitive month, and a lot of people subconsciously slot themselves into the competition.
The Cultural Need To Flex Financial Muscles
The cultural need to enjoy the good life during December makes people go against all their financial ethics and principles because it's just a few days or weeks. However, this post is not to begrudge this economic phenomenon, it's generally the way our mental anatomy operates, and this is often imbued into us, especially with the methodology of how we earn.
People who work 9 to 5 for example are always looking for the right escape to spend some of their money either on a holiday or a break. Because they mostly work to take care of essential needs, a time comes in their lives when they realize they're not living for themselves, hence, they'll take every opportunity or break they have to enjoy their lives to the fullest.
December become that perfect opportunity.
Don't get me wrong
.......the essence of earning money becomes realistically beautiful when we can bask in our capacity to spend on our outermost desires. Some people do not derive happiness from their jobs, but the prospective fulfillment of being with their family, and spending money to make them happy is what keeps them in the job.
These types of people are the ones who make sure they take advantage of every holiday to enjoy the fulfillment of spending, hence it wouldn't really matter to them if the prices are inflated, or if the Market forces are creating scarcity for their own materialistic gains, they just want to spend whatever it takes to enjoy the season, hence, Inelasticity originates from the retailer and embraced without question by the end-consumer.
An Interesting Point of View
People must want or crave or create competition before Inelasticity can be derived to a certain extent. Market forces are cushioned by demand and supply, and this is true because of the demand power of the end-consumer, but sometimes, the end-consumer underestimates they determine the control they have. In essence, everyone generally relaxes their mental accounting during December, because in reality, the essence of making money is gotten from its spending.
A Boundary & A Conscious Disposition
Sometimes, they (people) get themselves into overkill situations, overdo it and plunge themselves into precarious financial situations. This is why it's important to spend within one's means, create a boundary, and imagine an invisible line of incursion that we shouldn't breach irrespective of the shift in our emotional state in the attempt to make the most of a certain period to enjoy the resources we've garnered.
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A good consideration is instead of taking a 2 week holiday and spending X amount. How about working 1 day less per week and forgoing the holiday.
Which would bring more benefits and is there a difference in income?
This is realizable as well, but the truth is that, some jobs doesn't offer the flexibility of having some specific days off. Especially entities that only grant holidays but no break. However, owning one's business brings this flexibility you've mentioned..
I think the best thing is to own one's business and have a workable solution.
Facts - as always. I almost decided to buy and store some fuel (up to 50 liters) that I plan to use in December because they always create that artificial scarcity and hike the price during this period. On a second thought, I didn't. And thankfully, the power supply this period was and is still surprisingly constant.
Its actually like a rat race. The biggest victims are the masses that operate no financial principles - like budgeting and saving. So they live for December periods and squander what they did not make in one month. But for those that understand what they are doing, they always spend responsibly. After all, another December would soon be here.
Thats the problem. Everyone needs to learn how to stick to boundaries and not create financial challenges usually carried over into the new year.
I actually do bity own a generator and this isn't just because I cannot primarily afford it at the moment. But more because a struggling you man as man, I need to steer clear of financial addiction to some necessitious utilities. My electricity is just above average but I just plan my way around. But it's definitely good thinking that you buy and stock up because of those crazy December hikes.
I grew up in a very poor environment. I see people with this mindset, infact I grew up with them, amidst them and saw how they lived for December. It never helped them grow financially. The just keep repeating the process and remain in stagnation.
Thats why I call it a rat race - an endless circle. Struggle for 11 months and spend it all in the 12th. Repeat x infinity. Its crazy. And when you observe their financial status over the years, you are not surprised!
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Many people tend to spend above their financial capabilities during the festive season and that make them to become so broke at January which tends to look like the longest month in the year.. lol.. but are they going to learn their lessons ? I doubt.. it is becoming a norm to some people and that is wrong..
Well, we'll never learn, because the psychological need to enjoy oneself during this period is almost inexplicable. However, just a little financial decency can ulter this.
Fuel scarcity has become the norm every December. I don't think I have ever witnessed a December without fuel scarcity or a hike in prices, it is a wheel that goes on and on every year. I guess the reason why people say January is a hard month is because of all the subconscious spending that happens in December.
This is going to require strong training of the mind to make this shift, it certainly won't come easy, especially with the temptations of relaxation that comes with the festive period.
I think the consumer psychology on December is one of the reasons why most big events/concerts are held in that month. These also take advantage of the already activated consumer spending psychology. I'm always wary of the price movements that happen in December, there usually isn't any logical explanations.
Yeah, most big events tend to tilt whatever they're doing to December, because it's a period of gyration. A lot of people are hardly conscious of their spending and this makes it a time where business and firms take advantage
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When I hear of how people spend extravagantly in December, I just smile because I have no idea what that is about. Maybe it’s because I don’t celebrate the holidays. My spending is the same through out the year. I don’t have specific months I spend more or less.
I can understand how our minds free us of guilt of spending over during the holidays though. The point of making money after all is to be able to spend it.
I find the fact that people raise prices in the midst of the holidays to collect huge profits counterintuitive. You would think that people would be considerate enough to do the opposite to allow even the poor and struggling enjoy the holidays.
I think it's virtually because you don't celebrate the season at all. If not you'll be forced to spend, either on friends and family or maybe when it comes to matching or meeting up with inflated prices whatsoever. I don't celebrate it really, but I had to, even because the regular market had inflated prices..
I've been quite frugal this winter. The bear market fucked up my mood and my personal finances really bad.
Well, I guess we're in for the long bear haul this season. Everyone has no choice but to choose frugality.
The bear market might be over sooner than the majority belives.
A lot of people tends to think we might sink lower, before we go up.
it's better to be on the other side of the majority.
A lot of people are carried away during the Christmas season and just spend extremely above their budget. Some don't even have limit on spending..... things are normally high in dec period and after over spending in December, January becomes too lengthy to finish and difficult time to many people.
This year, I was sooooo concious of all by my Dec spending...I avoided a lot of unnecessary spending to avoid having a rough January 😂
You're a big woman, there's no need to actually caution yourself lool. You have a big family that needs attending to when it comes to Money hahaha. But on a more serious note, it's difficult to maintain discipline during a time like decent December.
Hahaha 😂
Why is everyone tagging me a big woman oo
Please oo.. you guys should not allow my destiny helpers to see this 😂😂
Sure . very difficult to maintain discipline during the season but it's possible to some an extent
But when one travel to village..it becomes super difficult 😂
I think it's just what people are used to and most of them don't look outside what they have usually done. In a way, I kind of blame the educational system because they don't teach people how to be financially responsible. They spend more than they need to because they think that everyone else is doing the same thing. I admit, my wallet is a little bit more open during December because I was with relatives.
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I am with relatives just like you too and sometimes, they subconsciously makes is spend even if we knew we would have maintained a more refrained wallet if it was just us alone. But like you said, financial discipline is not taught anywhere. It's sad to see that it's a journey we mostly need to undergo, ourselves
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