Do you spend money to save? There’s a term for that: “spaving”. Sometimes buying more of the same thing saves money in the long run – providing you’re very careful.
Do you need two pairs of school shoes, or pyjamas? Then why not wait until there’s a buy one get one half price or similar offer at your store of choice?
Likewise if you can fit 3kg of sugar in your pantry, then it’s usually cheaper per gram to buy it that way than in a 1.5kg bag. Or spending money on LED lightbulbs could save you money in the long run.
Here are my tips on how to spave:
When spaving can work…
Buy One Get One Free (BOGOF) deals are a great way to save money – ONLY IF you actually do need two of the same thing.
Group buying, AKA collective buying is clubbing together with others to buy goods at discounted prices. You can do this yourself and approach wholesalers – or even simply get together with a few friends to collectively buy your groceries at Costco.
Make sure you factor in any joining costs and always shop around. Just because something is billed as “wholesale” or “doesn’t make it cheaper than buying in the high street. One-day-deal websites such as Groupon are also called group buying sites because retailers are willing to offer goods and services for less through them knowing they will sell in bulk.
Buying up large at sale time sometimes makes good sense if the item in question keeps. It might not be in your budget to buy wrapping paper and Christmas cards in January, but it saves a lot of money. Likewise if you send a lot of cards letters overseas you’ll probably get a discount if you buy your stamps in bulk in November. They can be used all year round despite having Christmas artwork on them.
When spaving can fail….
It’s human nature to love a bargain and the road to credit card debt is “spaved with good intentions”. Just because something is on sale doesn’t mean you need to buy it. If you don’t need it you’ve lost money, not spaved.
If your favourite brand of trousers are on sale from $150 to $75 and you buy them, you haven’t necessarily saved a cent. In fact you might have spent $75 needlessly.
What’s more, bigger boxes of washing powder or cornflakes in bulk aren’t always cheaper than the smaller box. You do need to check.
To avoid falling into these spaving traps, stop and question every item you buy. Whip out your phone and do some research on the internet, and ask the shop assistant if the item has been on sale before.
And finally, to reiterate the point, spaving on credit doesn’t work. If you’re paying interest you’re not saving money.