Part of the American Dream has always been to own an incredibly large television. More and more these days, families are taking trips to their local electronics superstore “just to buy season six of Buffy the Vampire Slayer” and end up coming home with a 47-inch plasma TV with six-speaker surround sound and a gold-plated HD-DVD player. The price tag of these purchases is staggering; consumers in the U.S. spent $11 billion on LCD TVs last year.

Before you rush out to pick up your own oversized talking picture box, you should take into consideration a few things:

• How much money do you have?
• How much money do you make?
• Can you really afford a massive high-definition TV?
• Probably not, so put that credit card back in your wallet.

Unfortunately for our debt-riddled society, TVs are one of those items that people feel is a necessity. Thus they often don’t think twice before dumping X number of dollars on a new one, even if the old one is working just fine. But since we live in an “iPod Nation” where acquiring the latest gadgets regardless of price comes before things like financial security or intelligent thought, people will continue to buy large TVs they don’t need, can’t really afford, and shouldn’t watch as much as they do.

If you’re fully convinced that you need a new TV, and nothing I say can stop you, I hope you’ll use the following process to help guide your purchase.

Determining How Much Television You Can Afford

First, you’ll need to answer a couple of questions about your TV habits.

1. Do you currently have a working television?
2. How much television do you watch each day?

If you answered yes to #1, then stop reading this article because you don’t need a new TV. If you answered no to #1, or if you originally answered yes but have since taken an ax to your TV just to change your answer, then continue.

Now if you answered less than 2 hours a day to question #2, you’re not watching enough TV to justify spending $1,000+ on something larger or newer. And if you’re watching 2 hours or more each day, then you’re watching too much television and shouldn’t own one in the first place, let alone buy another.

Everyone should have been eliminated by their answer to #2, but if you cheated and are already on your way to the TV store, consider this formula to help you determine how much television you can afford:

Your annual television purchase budget should not exceed 0.1% of your family’s gross annual income.

So if you and your spouse are making a combined $100,000 salary annually, your TV budget each year should be $100,000 x 0.001 = $100.

This doesn’t mean you should purchase a new $100 television each year, and it doesn’t mean that a pricey high-def TV is out of your reach. If you only purchase a new TV once a decade, you can pool your yearly TV budgets. That $100 a year means $1,000 every ten years, and there are some nice LCD or plasma TVs that can be had at that price.

A few more points:

• Pay for the TV with cash or a credit card you pay off every month, or don’t buy one.
• If you have any form of non-mortgage debt, do not buy a new TV. Pay off your debts first.
• When you find yourself having to choose between putting food on the table and buying a new TV, please buy a new TV so you starve to death and do us all a favor.

Here’s a visual guide that’ll show you the kinds of TVs you can expect to afford given your financial situation. Please feel free to print it out and take it with you on your next trip to buy a television.

If your home looks like this…	And your bank account looks like this…	You can afford this TV…