Saving Money

With the severity of the recent recession, many stores are offering more incentives to shop than ever before – coupons, financing deals, free shipping and so on. But, according to a recent article in TIME magazine, those so-called “deals” might not be saving you any money at all. Some things to consider:

Coupons – Coupons are never a bad idea when you use them to get a brand you’d buy anyway. But they’re often used to entice you to buy something more expensive than usual. For instance, if you save fifty cents on a four dollar bottle of salad dressing, that doesn’t help if the normal brand you buy is only $2.50. To really use coupons effectively, you have to jump from store to store and from brand to brand – and it comes down to what you think all that time and effort is worth.

Low or No Financing – You may see big offers for 0% financing if you buy a big screen TV – but if you don’t pay back the entire loan amount before the 0% period runs out, you could get hit with an interest rate of around 30% of what’s left of the debt. These stores are counting on you not being able to pay back the amount in the agreed time – after all, that’s why you need the financing in the first place!

Free Shipping – Like coupons, this is often used to make the consumer spend more than they had originally intended. Usually, you have to buy a certain amount to get that free shipping. Say it takes $50 of purchases to get the free shipping from an online retailer – and you were only going to buy a $30 item. The incentive to not pay an additional few dollars in shipping might cause you to spend $20 more at an online store.

The Non-Stop Sale – There is a lighting fixture store we always pass – and the joke is, they always have a giant 20% or 30% sale going on. Some stores act like everything is always at discount – but the fact is hardly anyone pays list price and these places are just pretending their normal pricing is a huge savings for you.

So, before you go for what looks like an obvious deal, make sure it is actually a deal – and we mean for you, not for them.