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There are all kinds of shoppers out there: people who carefully plan for everything they are going to buy and make sure the money is in the budget, people who shop on impulse when they feel like it and many people in between. On average, Americans spent $ 183 on impulse purchases each month in 2020 – a lot of $ 2,196 a year that you could deposit, save or add to other purchases – according to Andrea Woroch, a nationally recognized consumer savings expert, citing a survey by Slickdeals. Whether you are planning your purchases or tending to impulse trading, here are some important questions that can save you a lot of money if you ask yourself them before you buy something.
Check out: Shopping Mistakes You Make and How to Stop
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Do I need it?
It may seem like an obvious question, but many do not ask themselves this basic question, according to Alissa Krasner Maizes, a financial planner, lawyer and founder of Amplify My Wealth’s investment consulting firm.
“If you want to save money, it can make a big difference to stick to your needs rather than your desires at the end of the year. Imagine spending $ 3,600 a year on clothes and $ 1,800 eating out. When you focus on spending only for needs, because many purchases in these categories are considered discretionary, you can potentially save up to $ 5,400, she said.
Can I afford it?
Another basic but necessary question requires you to be honest about your budget – which of course means you have one in the first place. “Whether you are shopping for a need, a need or a waste, ask yourself “can I afford it?” can positively impact your savings goals, ”said Maizes.
She said that a budget can give you “to make decisions that are in line with your financial plan. Although some people may find it limiting, it allows you the strength to not regret and make decisions that are thoughtful rather than impulsive. . ”
Is there a cheaper alternative?
Although there are some items where it’s just worth the money to pay for the brand, the latest model or a more expensive version or model, in general, Maizes said, were you looking for cheaper options before you buy?
She recommends some money-saving tactics to consider before making a purchase: sign up to text or email for a discount, search for coupons or discounts, wait for a sale or when shopping online and look for online cashback shopping portals such as the company is in line with.
“Over time, you can use these issues in your thought process for money, which can help you save on everything from food and subscriptions to cars, entertainment, vacations and homes, leaving your savings potential up to you and your discipline,” said Maizes.
Is there a used alternative?
Similarly, Woroch recommends looking for used items whenever possible, from clothing to furniture to toys. She recommends resale sites that specialize in specialty items to help you save. You can find gently used clothes for the whole family on Swap.com for a fraction of regular retail, exclusive used designer handbags at The Real Real at affordable prices, refurbished smartphones on Declutter, refurbished kitchen utensils and power tools on eBay or carefully used home furniture via Facebook Marketplace. “I recently found a bedroom agency on the Facebook Marketplace for $ 165 that is similar to a new style that I was tempted to buy for $ 799,” she said.
Did I compare prices?
Before you buy something, always make a quick comparison online to see if you can find the item you are buying for less, Woroch urged. She likes the barcode scanning app ShopSavvy, which provides instant price comparison when you shop in a store. Another one she recommends is the PriceBlink browser extension, which provides price tracking when you shop online to find the most affordable option.
Comparisons can extend to larger expenses, such as car insurance, as well. In fact, the 2017 Driving in America Report found that more than 1 in 3 Americans who did not compare car insurance costs over a three-year period lost $ 416.52 per year in potential savings. Use insurance comparison sites like TheZebra.com to find the cheapest provider without sacrificing coverage. “
How often will I wear or use this?
If you are planning to buy something that is not exactly cheap, it may still be worth it if you will get a lot of use out of it, Woroch said, such as a garment or shoes. “Calculate the cost per wear or use to determine if a potential purchase is worth the cost. For example, it’s worth spending more on a pair of high quality black boots that you’ll probably wear several times a week for a couple of years because the cost per use will be extremely low.On the other hand, handing out a few hundred bucks for an item that you will not carry much or use often. “
How does this fit into my long-term financial plan?
Finance coach Paul Scarfone, founder of DollarWhys, believes it is important to be prudent with financial decisions and to make choices that support goals now and in the future. By asking “does this support my goals?” you may be more inclined to pause an impulse purchase and put the money in a savings account or against a necessity. For every purchase, he also recommends that you ask: “If I say yes to this, what do I say no to? What opportunities will I miss by doing this? ”
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