Buying Things Because They’re on Sale Is an Awful Way to Save Money

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Suit on sale, in Lappeenranta by aNantaB on Flickr!For years, I’ve been on a closed email list with a group of like-minded people who enjoy sharing internet links with amusing comments (think of an email version of fark or reddit). Lately, though, the list has been completely overrun by a group of about two or three people who have become completely obsessed with bargain hunting for stuff.

On an individual basis, the messages are innocuous. For example, one recent email was for Heroes: Season 1 on DVD for $29.95, a pretty strong price. Given the people on the list, of which a large number are lifelong comic book fans, this seems like a worthwhile thing to mention since many of them are either fans of Heroes or are potential fans of the show. If you make a splurge purchase like this once a month, it’s not that big of a deal, and it’s something that many people on that list might enjoy.

The problem comes in when you read ten or more of these messages a day. The Watchmen for $8.99! Guitar Hero: Aerosmith for $19.99! A 50″ LED TV for $799! People were even linking to cheap eBay auctions.

It culminated (for me) with a recent email to the list (emphasis added):

Thanks for the emails guys! I saved so much money this week!

I realized, right then, that this had turned into a “deals” list, so I unsubscribed.

What’s Wrong With Finding Bargains?
A lot of people might read through those prices and think, “Wow! Nice deals!” For the most part, they are solid discounts on what you’d normally pay, and if you were already thinking of buying one of those items, it’s probably not a bad time to go ahead and pull the trigger.

The key part, though, is “if you were already thinking of buying one of those items.” When you go “bargain hunting,” you’re not seeking out a particular item that you need. You’re simply seeking out low prices and accumulating stuff for the sake of accumulating stuff. And, even though an individual item might be a bargain, buying a bunch of items is a sure way to empty out your pocketbook and make it difficult to make ends meet.

Doing that leaves you with a house full of stuff you didn’t really want and a nice big fat credit card bill.

Sensible Bargain Hunting
That’s not to say there isn’t a role for bargain hunting – there is. But when people snap to attention and pull out the wallet when they hear the word “sale” or see a big discount, they’re going at it completely in reverse.

The sensible way to bargain-hunt is to know exactly what you want before you even start looking. If you’ve decided, on your own, that you do in fact want Heroes: Season 1 for your own entertainment, great.

Now’s the time to bargain hunt, with the item you already have in mind. Utilize tools for finding it, like this clever trick for automatically bargain-hunting Amazon for specific items. Use price comparison tools to find the item at a steep discount. Set up saved searches on eBay and check them regularly. Check out retailers and see what their offerings are like.

The important part is to put on your blinders and ignore other items. A big sale on an item you don’t really want is still a waste of money.

Purposeful Bargain Hunting for Profit
One of my online acquaintances – a person I’ve mentioned a few times recently – makes his living selling trading cards online. He actually does very well at this. But he also bargain hunts quite often without any specific item in mind.

See, he happens to be a walking encyclopedia of trading card prices, and he’ll often go to different places simply canvassing for bargains. He has nothing in particular that he wants to buy, but there’s a chance he’ll stumble upon something that is genuinely mispriced. If he finds it, he’ll actually clean the store out of the item. He’s put more than $2,000 worth of trading cards on his credit card in one swoop when he didn’t intend to buy a single thing.

The difference here is that he’s not buying “stuff” to accumulate for personal use. He’s bargain hunting without anything specific in mind, sure, but when he’s buying the trading cards, he’s not actually buying trading cards. He’s buying goods to profit from – and he will profit from them.

In other words, using “well, I’ll make a profit” as a bargain hunting excuse only really means anything if you’re actually doing it. If you see an item you don’t need and didn’t really want, but you buy it because you think it’s actually worth more than the price, you’re still wasting money. The only way it’s actually worth more than the price is if you can actually sell it at a higher price.

Most Bargains Aren’t Bargains
The simple truth is this: if you’re buying something you don’t really need and didn’t really want before you saw it, you’re wasting your money (unless, as I mentioned, you’re going to directly profit from it). It doesn’t matter how good the “deal” is – if it’s something you weren’t planning to buy anyway, you’re just throwing away your money for stuff, and that’s a sure way to put yourself in a worse financial position.

By all means, buy some fun stuff for yourself. Just spend some time thinking about what you actually want – and then hunt for bargains on that item.

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48 thoughts on “Buying Things Because They’re on Sale Is an Awful Way to Save Money

  1. Yes! Finally someone else who thinks all these bargains really aren’t saving anyone any money. I hear people talk about how much they are saving, but they are buying things they don’t need or will get bored with very quickly.

    I think supermarkets abuse this “saving money” idea a lot too. They sell products that you might never buy otherwise at a discount. You think you saved money, but you might be stuck with a can of pineapple and no reason to open it.

    Great article!

  2. I know so many women who wreck their family budget buying bargains!! It is an epidemic. I know it well as I used to be one of those women. Shopping for something you might need is as crippling as holding on to “stuff” you MIGHT need someday. Everything has two costs-the cost to buy it and the cost to own it. I find myself no longer willing to pay either lightly.

  3. I totally agree with you. I’m not usually tempted by this type of thing, but my one weak spot is clothing clearances. I can usually manage to clothe my children well by relying on hand-me-downs and freecycle clothing, but boy am I tempted by 80% off clearances on children’s clothing. Like you said, though, if I didn’t really need it or didn’t plan to buy it, I’m not saving 80%, I’m spending an unnecessary 20%.

  4. Hi Trent,

    What you described is totally my weakness, I check internet deals websites at least few times a week and sometimes convince myself to buy items I probably don’t need or can wait. Brought a wireless router because it was on deal ( mail in rebate), was too busy to send the rebate form for 6 months ( when i opend the box), didn’t save a dime!!

    Although I am getting better now ( deleted those websites from my favorites, which has made a huge difference), I still buy coupons from Restaurant.com and don’t use for 2-3 months.

    Good post.

  5. I’m painfully reminded of all the “bargains” that hung in my closet for years with the tags still on them till I finally admitted to myself I was never going to wear them and gave them away. *Sigh!*

  6. Before my wife and I had a serious Come to Jesus on our spending a few years ago, she’d return home from shopping with armloads of clothes. As I dug through her purse for the receipt, she’d say, “Before you say anything, I just want you to know I SAVED us $400.”

    My reply? “I really don’t think we can afford to save so much money.”

    It’s definitely a trap, this “On Sale” business. These days, whenever we buy something — and the receipt tells us how much we saved — we actually take that amount of money and deposit it into our savings account.

  7. I so totally agree! How many times have we all picked up something thinking “what a great bargain” when in reality we never needed it and will probably donate it down the road.

  8. i like looking on the offchance i might need something, but i am usually strong enough to logic myself into NOT buying things i don’t need.

    make a needs/wants list and then hold onto it and if it’s on sale (or you have a gift card), then get it and if it’s not, then wait. be strong!

  9. I’m with liv. I know that online window shopping won’t get me so I enjoy myself and look often. I really did need a new printer and found a killer deal at Office Max today. Still patting myself on the back for that one. But I wouldn’t have found it if I hadn’t forced myself to put down a “75% Off!!!” printer at Target last month. It hurt at the time, the 75% off was calling to me. Never mind that it wasn’t even the kind of printer I wanted.

    I’m much weaker when it comes to deals in brick & mortar stores so I either shop chaperoned (with my mom – technically a gas saving/errand pooling arrangement, but having someone say “really?” is a nice fringe benefit) or try not to shop at all. Don’t get me started on the evils of TJ Maxx & Marshalls.

  10. Sorry to hear about the decline of the list, Trent. These folks should have realized that there are approximately 10 billion websites devoted to listing great deals online — having them emailed to you is pretty unnecessary.

  11. I had to unsubscribe myself from the newegg.com newsletter due to this effect. I didn’t buy *too* much but I did get a couple of items I hadn’t planned on beforehand. This is a double whammy if you’re trying to avoid the accumulation of Stuff – whammy one is wasting money, whammy two is wasting precious space in your home, one $10 mini MP3 player at a time.

  12. Trent, I agree that you should buy something on sale only if you were intending to buy something like that in the first place.

    But what about things like food or clothing? If I am at the grocery store, and I notice a good sale on some food item I wouldn’t normally buy, then if I buy it, I think I’m saving money because I would have to eat some form of food anyway.

    I think the same is true with clothing. I remember you said a while ago that you had many pairs of sneakers in line waiting to replace the current pair when they run out. You wouldn’t normally go to the store to buy 10 pairs of sneakers, but if they are heavily discounted, then ‘stocking up’ represents significant savings.

  13. My wife bought a big bag of limes at Costco becuase it was “such a good deal.” You should have seen how much we spent on Corona as an excuse to use up those limes!

  14. Well I have to say in the past couple of months I really took up ‘bargain hunting’ when it comes to drugstores (Cvs, Rite Aid, and Walgreens) and sure enough now our house is being filled up with things that we don’t need right now per say but I definitely think we will use in the near future. I think as long as it’s really a bargain and you know you will use the item it’s a good idea but don’t go overboard.

  15. You are SO right!

    Another sign that you are buying for the “bargain” is when you KNOW you don’t need the item but pick it up anyway for someone else that may like it.

    It is VERY tempting marketing.

  16. Well said!
    But I also agree with comment #9- if there’s something you *know* you’re going to use, even if not immediately, it can be worth it to stock up. The catch is, you have to be honest with yourself about whether you’re going to use it or not.

  17. bargains got me through college. when my money was super limited I lived on fatwallet.com finding little deals here or there and pretty much everything I got got used.

    Once I got a job I started accumulating bargains cause I could afford everything. Now I have way too many unplayed video games and DVDS.

    The bargain bug still hits me at times. (I just bought assassin’s creed for 24$ despite having no time to play it). but I’m better at controlling it. especially when it comes to dvds.

    I do admit I kind of replaced the “buy a dvd thing” with DVR movies I don’t have time to watch, but at least the dvring is free. (relatively).

    Oh and please tell me guitar hero aerosmith was the wii one, if it was the xbox360 one i’ll hit myself for missing it! (There’s always time for guitar hero)

  18. “The more you spend, the more you save” – advertising slogan which should be banished. It amazes me how many people fall for it, even on the blogs. I ignore sales because very few things I buy ever have sales. Buying something on sale that I didn’t plan is achieving nothing but spending money on junk.

  19. I use the amazon wish list to price track. I add items I want to a private wishlist and then just log in and look at the list about once a week, and then when any of my items goes on sale, I can see it. Bonus, about half the time, after a few weeks, I often decide to remove items I decided in the meantime I really don’t need.

  20. Well said. Now I am feeling guilty for spending unnecessarily this month coz the bargain was so good!!! 2 pounds for a pair of jeans?? Feeling extremely guilty now after reading your article. That’s because I know it, I am aware of it but the deal is just too good and voices from friends you shop with can be very influential. So, to add on, one very important point is: choose a correct partner to shop with. Now I have a whole load of new clothings in my wardrobe and I want to sell them off!!

  21. Geron, that’s a good point. If it’s something that I’m going to run out of or use up, I have no problem buying extra when they’re on sale. But when I already have enough children’s clothes to last them through the season, buying more stuff on sale is a waste of money.

  22. My local QFC grocery store requires the use of one of their cards to get the “sale” price. The checkers always announce, after ringing up your receipt, “You saved X dollars today!” The first time I was told that, I responded, “That assumes I would have bought those things at the non-sale price, doesn’t it?” and got a blank stare.

    But there’s really no such thing as a “sale price” as distinct from a “price.” The price of anything is simply what you’re willing and able to pay for it, and the only way to prove willingness and ability is to actually buy it.

    Liv at comment #5 mentioned “i like looking on the offchance i might need something.” But how likely is it that you would really “need” something and not know it? I used to spend an extra $100 every time I went to Costco, because there was always something (usually several somethings) that I “realized” I “needed” only when I saw it.

    Now I have a rule. If I see something I “need,” unless I won’t survive the evening without it, I walk away. By the time I’m home and have the groceries put away, it’s usually been forgotten, but if not, then I look it up online and if I find it at a better price, add it to my shopping cart, and WALK AWAY. If, two weeks later, I’m still convinced I need it, then I order it or if Costco is cheaper, add it to my Costco shopping list. 95% of the time, I forget about this “need” completely.

  23. We should only buy what we need when we need it. Most of my bargains end up at the Salvation Army. So, I have adopted the buy only what you need when it comes to the non-essentials.

    Okay, I love bargains, just got 4 more binders at staples for 25 cents each, they were even giving stuff away for free, I came out with two full bags and I only spent $2.49. However, I was at a department store this weekend and was tempted at every corner and did not buy anything. Binders will not end up at Salvation Army but now I have to find a place to put them.

    Yes, I am not one to talk, I would change my closet every week if I didn’t try so hard to live in “Common Sense” Land.

    I am now going to reassess my values :D thanks for a great post.

    -Tabs

  24. A bargain is only a bargain if you really needed the item anyway. But the real trick is to define “need”. Do you “need” that DVD? that extra pack of Cheetos? that t-shirt? etc. Stocking up is often a valid need, but sometimes it’s just that warehouse-club mentality making you buy 50x instead of just 1x.

    A good neutralizer of the “spend to save” mentality is to reset your zero-point to $0. We just posted something in this vein recently (DR vs. your stuff).

    Think of a traditional math number line, 0 +25 +50 +75 +100. A spender thinks “$100 item on sale at 25% off” equals “I just saved $25″. Their zero-point starts at $100, working backwards to $75.

    The saver thinks “$100 item on sale at 25%” equals “I have to spend $75 to buy it”. Their zero-point is at $0, going up to $75.

    In both cases, your wallet loses $75. Yes, you also gained an item. But is it worth $75? That’s often the harder question (visit the DRule site for our extensive blathering on that).

    Thing is, if the item was say $200 but on sale for $75, do you now save $125? Was the item really worth $200 if they can afford to sell it for $75 (no nitpicking about loss-leaders in such a contrived example)?

    I like Frugal Bachelor’s comment about “the more you spend, the more you save” slogans. Talk about brainwashing the masses.

  25. I always see those those car dealership ads where they yell and scream “Come in today and SAVE $5000!” And I think to myself, “or I could just stay home and save $20,000.”
    Hey, I just saved $20,000 today. Beat that, Mr. Car dealer!
    So the next time you see a tempting deal that says “Buy today and save THIS MUCH.” Just think about how much you you save by NOT buying at all.

  26. Sales like this remind me of government tactics. Here in Canada, they lowered the tax rate (GST) to 13% (used to be 15% at one point). This does nothing for me because I will have to spend money for this to actually apply to me.

    I’d rather see them lower the amount of tax they take off my paycheck… crooks

  27. Totally agree. And that’s the exact reason I don’t go into clothing stores anymore just because they’re having a sale! I used to end up with so many items that I never even took the tags off because I saw it for a good price and thought ‘it’s a bargain’, even if I didn’t need it.

  28. The Tightwad Gazette put this in a way that really hit home for me — “it’s not what you save, it’s what you spend.” I try to keep that in mind whenever I’m looking at something I don’t really need but is at a tempting sale price.

  29. I had to stop looking at the deals online until I’m actually ready to buy…

    Once I’m ready to buy, I’ll do some research…

    For books, I’m now trying paperbackswap 1st, but then if I’m still going to buy it I’ll try out one of the many comparison sites out there…

    My favorite is http://www.booksprice.com, but I also use http://www.isbn.nu from time to time. They’ll show what the best price is online including places like Amazon, Amazon Marketplace, and Buy.com of all places.

    For electronics, I check out the following sites to make sure I’m getting the best deal possible…

    1) http://www.salescircular.com (is there a local sale in the weekly flyers, here’s where I find out)
    2) http://www.dealcatcher.com (uses Pricegrabber if it doesn’t find an advertised online deal)
    3) http://www.dealnews.com
    4) http://www.pricespider.com (newer service I’ve been trying with mixed results)
    5) http://www.live.com/cashback (typically finding better deals above, but not always)
    6) http://www.shoplocal.com (might as well see if there is a local deal that’s close to the best deal online, why wait if it’s the same price nearby)

    Hope someone enjoys this list, there are lots more deal sites out there, and I search on Google too…

    Take care,
    Jeff

  30. I disagree with you. You say “The sensible way to bargain-hunt is to know exactly what you want before you even start looking.”. This is not necessarily true. I play the “drugstore game”. This week I got paid to “buy” tampons, pads, pepsi products, cosmetics, and energy drinks. Did I need these? Not immediately. Did I know I wanted them? No. Were they a bargain? Yes, they paid me to get them.

    You also say “The simple truth is this: if you’re buying something you don’t really need and didn’t really want before you saw it, you’re wasting your money (unless, as I mentioned, you’re going to directly profit from it). It doesn’t matter how good the “deal” is – if it’s something you weren’t planning to buy anyway, you’re just throwing away your money for stuff, and that’s a sure way to put yourself in a worse financial position.”

    Which is also not necessarily true. For example, my daughter is 22 months old and about 6 months ago I began buying potty training supplies like training pants and a small toilet seat and potty chair for her. Did I need them at the time? No. Did I “want” them? Well, not sure. But, I ANTICIPATED THE NEED. Bargain hunting for anticipated needs can indeed save a lot of money. Because I was able to pick and choose, because I was not in immediate need, I could choose the better deals. Now that we are actively using the potty training supplies, I do not have to scramble and pay full price.

  31. I read this and the same thought kept playing over and over in my head, ” I stopped coupon cutting years ago for the very same reason”. I always felt like coupons were put in place so I would buy what the advertiser wanted me to by. Once I stopped cutting coupons and started shopping smart I actually started saving money.

    I love reading your articles I get so much out of them and reaffirm what I believe.

    Thanks

    Shawn

  32. There is a cost to not watching fatwallet or whatnot. Chances are when you go to buy something, there won’t be one of those crazy deals available at that exact moment. But IMHO it’s not worth the effort (time) to watch like a hawk for crazy deals – and the amount of stuff you are tempted into getting that you wouldn’t have otherwise more than destroys your savings.

    So nowadays when I want something, I google for the best price I can easily find at that moment, buy it, and move on with my life.

  33. I’m sure many of you are familiar with WOOT! The whole company is based on this premise. They give one deal a day. And lots and lots of people buy it, regardless of whether they need it or not.

  34. I have found myself caught-up in the sales madness. I found that a lot of the stuff I bought because it was on the clearance rack is stuff that I didn’t wear often — didn’t fit right, not my style, whatever. I then decided that I’d buy something when I need it and then look for the best price. Even if I end up paying full price, it’s worth it if it’s something that works well for me.

    I do like to take advantage of sales at the grocery store if they are items I’ll use and are non-perishable — IF it’s actually a deal. Sometimes, the sales aren’t so great. I also like to take advantage of off-season sales, but only if it’s something I really like and will definitely wear, like a pair of new dress boots (which I need for this winter).

  35. I’ve heard this comment in the past:

    Woman will spend 1$ on a 2$ item she doesn’t need and a man will spend $2 for a $1 item he does.

    I’m repeating a sentence and not stereotyping the point is that spending even a dollar on something you don’t need is a waste of money where spending $2 on something you really do need is much more worthwhile even if you’re overpaying.

    Sales are meant to clear a product from the shelves of a store – they’re enticing the splurge purchase. The store is still making money and if you didn’t need the product then you’re loosing it. The biggest thing for me to keep in mind when you spend money is are you buying something that you need or truly want or are you buying because you’ve been enticed to buy? I see lots of people spending money for the sake of spending money.

  36. As may father always said:

    “We are going to go broke saving money”.

    Basically, when I need to purchase something that’s kind of expensive, I’ll do a quick Google search or hit a few sites (Amazon, etc) to get an idea of what something’s going for and then buy it. But I most definitely don’t go out and buy something unless I truly do need it.

    Also, since we are working on budgeting for the next month, impulse buys are pretty much over. If we need it, we can generally wait until the next budget interval to buy it, or it’s an emergency item for something that must be dealt with immediately.

  37. Personally speaking this has to be one of my biggest gripes about today’s manufacturers coupons. No longer do you get $1 off the price of a frozen pizza – it’s more like you get $.40 off of 3 pizzas. It gets old quick, buying more than you have to just “save money”.

    Consumers who grab up so-called deals only to find the merchandise cluttering up their homes need to realize their bargain purchase price would be better off in an interest bearing account. Now they need to go through the process of unloading the stuff on eBay or at a yard sale with hopes of maybe getting some of their money back.

    Impulse buys are impulse buys – not matter how much of a bargain it may appear to be.

  38. I get sucked into this “sale” thing often especially when buying clothes for my girls. Just last weekend I bought them 2 new gowns for 50% off when in actual fact they have more than enough gowns at home. But the thought that I was saving 50% got to me, plus they were very nice gowns.

    I just need to make sure I stay at home during sales. That way I save 100%.

  39. My wife and I always try to buy thing off season. For example instead of buying an outside furniture set in may we will hold off until the end of season then buy the same set for 40% off. However, it does not matter how little you pay for an item, if you don’t need it you are not saving any money.

  40. On buying bargains to make money: I have bipolar disorder, and one of the pitfalls of the manic phase is a sense of financial invincibility paired with misguided ambitions. At one point, I was buying dozens of Beanie Babies and action figures per month, certain I would sell them for huge profits to collectors. Most of them ended up donated to charity or liquidated at yard sales because I ran out of credit and room in my house.

    A manic friend of mine ran across a dollar store DEAL on those flat garden hoses that sold for $20 on TV. She bought at least 50, stacking the shoebox-size containers against a wall in her tiny apartment. Although she sold a few for $5 to friends and acquaintances, the rest took a major toll on her living space and morale. Final destination: the dumpster when she moved.

    It’s easy to get caught up in calculating the potential profits of a bargain, but how often do we consider the cost in square feet of storage, physical effort and mental stress? If I were going to collect anything now, it would be paper goods or something very small and very likely to retain its appeal and grow in value, like historical documents or fine miniatures. Better yet, I buy what I need to live and leave the speculating to people who have plenty of disposable income and an outlet for selling.

  41. I totally agree! I hate it when things are bought because they are “On Sale” but am guilty of some indulgences. However, my room is so small that my deciding factor in buying something is if I have space. For example: Clothing. I cannot afford the space to buying new shirts every time that I see one, however, if there’s a new shirt (I’m a thrift-store girl by nature) that’s really cheap, I’ll get it if I really like it (I wear out my clothes, so I’ll be getting rid of 5 things next month probably anyway). However, some things are far too good to pass up, like a deal I got last tuesday on lip-gloss. I hardly ever wear the stuff, but once in a while I do. Now, normally Covergirl is about $6 a tube, and my favorite discount store was selling it for 10¢ a tube. I bought all that they had (about 10) kept 5 for myself, and am donating the other 5 or 6 to a retirement home where they go crazy for any kind of makeup. In the 10¢ bin they also had thermometers, and so I got three, because our old one was wearing out, so for 30¢ I figured having a few would be a good idea. The catch is that all of that could fit into a pocket, or into my makeup case sitting in my room, with a ton of empty space in it.
    Just my two cents.

  42. As always your article has been so helpful and I couldn’t agree with you more. I only buy bargains when I ahve a specific thing in my mind but I don’t buy for something because its cheap.

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