The following is a guest post.
Andrea Woroch is a consumer and money-saving expert who shows people how they can live on less without radically changing their lifestyles. From smart spending tips to personal finance advice, Andrea transforms everyday consumers into savvy shoppers. She has been featured among top news outlets such as NBC’s Today, Good Morning America, Dr. OZ, CNN, New York Times, Kiplinger Personal Finance, and many more. Follow her on Twitter or Facebook for daily savings posts.
As a consumer savings expert, it’s my job to know how people can save money on everyday expenses and little indulgences. Though I’m always on the lookout for new strategies, there are some money-saving antics that I don’t condone, including anything that requires you to pay more than you budgeted for, or sacrifices your integrity in the name of savings.
In a new twist on my typical tips, here are several savings strategies I don’t recommend, and why.
1. Opening a store credit card.
Anyone who’s purchased something recently has likely been tempted to open a store credit card for the upfront savings of 10 to 20 percent off. However, these cards should be approached with caution. Not only do consumers typically purchase more when opening a store card with the notion of getting the most from the initial discount–a move that can cause a serious blow to your budget—but these store cards carry high interest rates. Annual APRs are usually over 20 percent and opening them can often ding your credit score making it harder and more expensive to negotiate a future home or car loan. If you shop with the retailer regularly and can afford to pay off your balance monthly, consider it for the rewards. Otherwise, politely decline the cashier’s automated offer and stick with more traditional payment methods.
2. Buying more to qualify for free shipping.
Since many online retailers offer free shipping with a minimum purchase, it’s tempting to load up your shopping cart to reach that minimum. However, it doesn’t make much sense to buy items you don’t need just to avoid the cost of delivery, especially if what you add to your cart ends up being more than the cost of shipping. Always look for free shipping codes on such deal sites as FreeShipping.org before checkout to ensure savings. Otherwise, I recommend you pay for shipping when you’ve budgeted for just one item to avoid wasting money on items you don’t need.
3. Using cash instead of reward credit cards.
This is a tricky one, since consumers who can’t control their spending should definitely opt for cash over credit cards. However, if you’re able to pay down credit card debt every month, it’s better to earn such rewards as cash back, travel miles and gift cards on everyday expenses than to simply pay with cash. You’ll get more bang for your buck and can use your accrued rewards to offset luxury purchases like a vacation or dinner at a fancy restaurant.
4. Spending weekends clipping coupons.
Extreme couponers boast about paying nothing for practically everything they purchase, but they do pay their fair share in time. It takes lots hours, energy and organization to find coupons for everything on your list, and in my opinion it’s unnecessary in this digital age. Free mobile coupon apps like the popular one from CouponSherpa make it much easier to use paperless coupons on the go, especially when you can load up your supermarket loyalty card and forego using your smartphone at checkout.
5. Shelf clearing.
Speaking of extreme couponers, shelf-clearing is a strategy I particularly loathe since it takes away savings opportunities from others. I’m not alone in my distaste for this approach to saving, as store owners have recently tightened their coupon policies to restrict the number of items a shopper can purchase at the advertised discount. I enjoy saving as much as the next person, but I draw the line when it becomes more about winning than about practical purchasing behavior.
6. Stealing newspapers for coupons.
I’ve already mentioned my lack of desire to cull through circulars every weekend, but I understand those who incorporate it into their daily routine without letting it consume their spare time. However, what I don’t understand is people so desperate for coupons that they’ll stoop the level of stealing them from neighbors, grocery stores and delivery trucks. In addition to harming the people in your community, delivery drivers in particular may be required to pay for missing copies of newspapers out of their own pockets, making this strategy especially repugnant.
7. Returning items after use.
We all know someone who has purchased a dress for a special event and kept the tags on, or sported a new clutch on a first date only to return it the next day. I understand the impulse to avoid spending money on something you’ll only wear once, but there are more honest ways to accomplish this. For example, shop a friend’s closet for a new outfit, or peruse the handbag section at discount retailers like TJMaxx for cute clutches priced under $20.
8. Swapping tags or packaging.
Have you ever considered switching tags on an item to score a discount? Me either, but unfortunately I know someone who switched a queen-size duvet cover with a lesser-priced twin package. When I heard about this, I couldn’t stop thinking about the inconvenience this would cause an unsuspecting consumer who purchased the queen cover in good faith, only to find it’s the wrong size. Ultimately, this strategy is stealing, and there’s no reason to stoop this low in pursuit of savings.
9. Consistently buying cheap items.
After years of spending money on my wardrobe, I know when to save and when to splurge, and the distinction is essential when it comes to actual savings. Stores like Forever 21 may seem like the perfect solution when you want to wear something new everyday, but ultimately their garments aren’t known for being well made (which is why they’re so cheap). Loading up on cheap stuff that falls apart after a couple wears is not as cost-effective as investing in a few well-made, classic pieces that last years. The same goes for home goods and furniture. My brother purchased a cheap, $600 L-shaped couch and is ready to toss it to the curb after just one year. Had he invested in a quality sofa for a little more or searched consignment shops for previously owned furniture, he could’ve had something that would last years, not months.
Are you guilty any of these savings tactics? Are there any other savings tips that you personally don’t recommend?