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July 23, 2012 | Posted By: Elina Smith | Categorized in: Finance, Shopping, FatWallet, Family, Couponing
It Makes Sense to Use Every Saving OptionIf the recent economic problems of the world have taught anything it is not to take things for granted. Many households were shaken out of their complacency as the crash had the effect of closing down businesses, increasing unemployment and causing the collapse of the real estate market.
Most people in the industrialized world have lived with a good deal of debt; credit was easy to obtain whether credit card or short term loan. Things changed with the crisis with credit card balance debt suddenly becoming something many households simply couldnít handle. They had not thought they would find themselves in the position of having to pay balances off without the option of perhaps switching them to 0% balance transfer cards that the companies seemed to be offering on a daily basis.
A new financial reality struck and a painful reality it has been but if it leads to a more sensible approach to finance in the future it will be a hard lesson but a soft landing.
A disciplined approach to finance involves a budget that includes all income and all expenditure, bearing in mind unexpected bills may come in for things like medical treatment and repairs to home or car.
It is a fairly simple exercise to write down all regular expenditure and where particular things seem high, looking at that expenditure more closely. If finance is tight it is particularly important to look at this and decide on whether there are savings to be made either by finding a cheaper alternative or by cutting out the purchase altogether.People spend considerable time on the internet these days and companies see their websites as particularly good sales and marketing tools. Online spending continues to increase and many companies have devised ways to advertise special offers of discount, coupons to offset the full cost of a purchase.
There is no doubt that savings can be made by looking for the regular promotions on the internet, perhaps sacrificing brand loyalty at the time but nevertheless making purchases. Whether those purchases may always be of essentials from the monthly budget is another question. It is all so tempting! Itís a bit like the Christmas Sales; there are huge discounts available so logic says the buyer is saving money. The counter argument of course is spending on something that is not needed counters the discipline of a budget.
Coupons used to be physical things that needed to be distributed in some way; online coupons make them available to everyone who accesses a website. The last available full year figures for the USA says that $4.5 billion was saved on consumer products by coupon use, up $0.7 billion from a decade ago. The strategy of marketing departments is that coupons are saved by people who are price sensitive but that allows scope for price increases for those that arenít with coupons there to offset the real price.
The online retail market is continuing to grow and many use coupons as part of a strategy. They can be used for direct sales to the public with free delivery as an incentive, with the offer varying between a discount in dollar terms or a percentage off the published price. They are not only used for direct sales, they can provide a code for shoppers who can call at specific stores for their purchases. The bottom line with whether a household is acting sensibly by using the range of coupon discounts available online is whether the purchase fits in with the budget. Budgets do need a certain flexibility but do not include buying something on a whim simply because there was a special offer, a greatly reduced price.
Many got into trouble because of this type of spending often on a credit card with just the minimum monthly payment leaving a balance that incurred high interest, into the 20%. It was what the credit card companies wanted because that is how the make the bulk of their money. There is now a new financial environment after the number of defaults that have occurred. That environment calls for restraint and budgeting. Getting a discount via a coupon on lifeís essentials is very wise and sensible buying simply because there is a special price is not if the product isnít needed.
Elina Smith is an experienced content writer on various finance topics. She has been contributing articles since a long time. She has a vast experienced in personal loans, shopping, debt, credit, and budgeting related issues.
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