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Spending is not saving

26 Jul

Hurry!  Act now!  This deal won’t last long!  Spend, spend, spend!

As the Today Show reported today, retailers are trying to get people to spend more money quicker.  They set up limited time only deals and use other tactics to get the consumer to buy impulsively.  The longer the consumer has to think about the purchase, the less likely she is to buy it.

As someone who works in retail (whose paycheck depends on the growing sales in the store) I want people to spend their money, too.  However, I don’t want them to spend to the point that their families go without food or heat.  The mentality that in order to save you must spend is a dangerous one and gets many people in trouble.

Say it with me: spending is not saving.

The Today Show interviewed a mother/daughter duo who are addicted to online discount sites.  They admitted that they are thrilled when they get a good deal.  The question that wasn’t asked was, “Are they actually getting a good deal?”  The daughter sees a $600 designer dress marked down to $200 and instantly she has to have it.  One click and it’s hers.  “I just saved $400!” she probably thought.  What she really should think is, “I just spent $200 on a dress.  Will I wear it enough to get that value out of it?”

This mentality is where problems arise.  The consumer thinks she is saving when really she is still spending.  Unless it is a necessity, like food or water, then everything else is a luxury and should be questioned before purchase.  This mother/daughter duo looked like they were well off but this thinking is dangerous for people of all stations.  The Today Show didn’t question the mother if there was any debt involved.  That is exactly where people are headed when they continually buy impulsively.  First the credit cards get maxed out and then there’s no money in the savings to pay it off.  Fees start piling up and the debt spirals out of control.  It could end in losing the house or having to declare bankruptcy.

There is a way to avoid all of this.  When getting a “deal” on a purchase, think “I spent…” rather than “I saved…” and see if you cringe.  If you don’t, try it again in a day or two.  If you’re still satisfied with the purchase, then keep it.  If you’re still cringing, get your money back.  Another way to save could be when passing up a “deal” like the $200 dress, take that $200 you would have spent and put it in your savings.

Let’s say it one more time: spending is not saving.

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1 Comment

Posted by on July 26, 2010 in Rants

 

Tags: , , , ,

One response to “Spending is not saving

  1. Liz

    July 26, 2010 at 9:02 pm

    Check out this video about Payday Lenders on The Rachel Maddow Show:

     

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