If getting 50% off for buying a second item or earning free shipping by adding another $20 to your online order sounds like you’re saving, you might want to think again. There’s no shortage of offers from advertisers that dress up spending to look like saving. The practice is called “spaving,” and it’s become a popular way to lure shoppers chasing bargains. But while there might be some upsides to being a spaver, it may be costing you more than you realize.
The Skinny on Spaving
If you have trouble passing up a deal, the emotional high from finding a bargain may be clouding your judgment about what’s actually going on in your wallet. Here are some common retail strategies that can tempt us to spend more than we should:
- Buy one, get one free — or BOGO.
- Upping your spending to earn a better discount.
- Purchasing more to qualify for a “free” bonus item.
- Buying more to get free shipping.
- Paying for a subscription to receive “members only” discounts.
There’s nothing inherently bad about these offers — and if you’re planning to buy two T-shirts anyway, getting one of them at half price is a good thing. But if you do the math, you may find the impact on your bottom line is taking your savings account in the wrong direction.
Dangerous Discounts
Before you jump at the next special offer, consider how spaving might be costing you in the long run:
Spending beyond your budget.
You’ve set aside $50 to buy new jeans, but if you just spend an extra $30 you qualify for free shipping. It sounds like a great deal, but now you’ve gone over budget, which might either run up your credit card balance or take a bite out of your savings — and leave you out of pocket
Buying things you don’t need.
If you’re in the market for an item, shopping around for the best price is smart — but impulse buying just because the discount is attractive isn’t really saving you anything. Consider whether that toaster is just going to end up gathering dust next to the waffle-maker, the sandwich press and the bread machine you bought the last time you scored a “bargain.
Overbuying perishables
Your grocery list includes a pint of strawberries, but when you see a “buy one get a second half price” sign, the deal seems too good to pass up. However, keep in mind that if you’ve purchased more than you really need, and those berries go bad before you can eat them, it could end up being one rotten deal.
The Bottom Line
While discounts and free shipping can be attractive offers, they don’t help you save if you’re busting your budget in the process. If you find spaving offers too tempting to ignore, try unsubscribing from retailer mailings and making a list of items you need before you shop. Work with a Financial Professional to help set a realistic budget that includes regularly putting aside money in your savings account or building your retirement plan — rather than getting burned by the next half-price toaster.
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