A few Coupon tricks

Manufactures want you to buy their products, but they also know that we are creatures of habit.  Manufactures know that they must find a way to lure you away from your habits of purchasing someone else's brand of fish sticks to get you to buy theirs.  How do they do it?  With coupons.

I’m not suggesting that you start dumpster diving to get mountains of coupons for products that you will not even use.  I’ve seen those extreme shows where die hard compounders spend more time planning a shopping run than actually going to work. Just use the coupons for the products that need that pop up right in front of you.

As always, go to the grocery store with a list that you intend to stick to.  When you get to the store, pick up the in store flyer and see if there are any coupons for the products that you need.  Don’t stick to a specific brand, but be flexible.

When you get to the product that you need, look for two things.  Peelies and blinkie boxes.  A peelie is a coupon that is on the product that you peel off and present at the register.  A blinkie box are those coupon dispenses that hang on the shelf with the product.  compare the prices of all the brands, taking into consider any coupons from the store flyer, blinkie boxes, and peelies. 

You may like a particular brand, but you may also like a brand that you have not yet tried.  Do not develop a brand loyalty.  The manufactures are not loyal to you.  They only want your money.  Spend it wisely.

Planning Your Grocery List

Impulse buying is a wonderful way to lose money.  Impulse shopping runs rampant in grocery stores.  Before going to the store, make a list and stick to it.  If I find that if I need to go to the store for something, I run in, get the items and then quickly get out of there.  This is especially true if I am hungry.  Know what you are going to buy and avoid the rest.  If you need to reduce temptation, move through the safe aisles of the store.  Those are the aisles of cleaning supplies and dog food. Get in, get out, get done.

Use that Rebate!

A rebate is a discount that you have to apply for through the mail in order to get it.  A rebate is used to tempt you to purchase a product and lure you into a store.  The thing about a rebate is that it takes effort and time to get it.  Both of these play into the hands of the products manufacture. 

They rational is that if it takes effort, most people will not bother doing it.  Actual rebate rates are very hard to get information on.  I’m finding that rebates are claimed at the rate of 2% to 80%.  That is a wide range.  The reason for this wide range may be to obscure the fact that this is a profit stream for the manufactures. 

One of the data sets that I looked at stated that nearly half of the TiVo subscribers in 2005 did not redeem their $100 mail in rebates.  The result, TiVo pocketed approximately $5,000,000 dollars. 

If you are considering purchasing a product because it has a rebate, make sure you read the terms carefully.  Many rebates come with requirements to purchase additional services with a required period of time that you must retain that service.

Many rebates require a little effort on your part.  As proof of purchase, you generally need to send in a copy of your receipt, any rebate documentation, and cut out the UPC bar code attached to the product’s box.  Yes, the actual code, no pictures or photo copies.  It looks like this.

So, is it worth the effort?  Everybody's choices and situations are different.  If it is a simple mail in with no strings attached, go for it.  Let’s check the value of your investment in the time it takes to sign the form, cut the UPC code, and drop it in your mailbox.  That should consume no more than 10 minutes of your time.  To let you know how much money you are making, take a look at the table below.  It simply shows you the rebate amount and how much that time spent equates to a salary per year working 40 hours a week.

Amount of Rebate	Annual Salary Equivalent
$10	$124,800
$25	$312,000
$50	$624,000
$100	$1,248,000

So, for all you TiVo subscribers out there who did not mail in your $100 rebates, for a brief 10 minutes of time, you missed out on working a job that had the equivalent of a 1 million dollar a year salary.  In the process of not redeeming your rebate, you made some stock holders very happy.

Eat Before Getting Groceries

Have you ever noticed that if you go in a grocery store hungry, you come out with a lot more than you were planning.  Grocery stores love hungry shoppers.  Doing some online research, I've found the hungry shoppers spend an average of 15% more on food then non-hungry shoppers.  Take a look at the time of day you go shopping for groceries, change your grocery shopping time to just after a meal.  If you spend $200 a week on groceries while you are full, you will spend an extra $156 a year on food you do not need.

Be smart, shop full

Smart Choices

Today my wife and I decided that we need a new bed.  OK, we have known that for a long time.  We have been looking at the expensive memory foam mattresses and we found one that we liked.  Before buying we asked ourselves if we really needed such an expensive bed.  We went to a mattress store and started sampling.  It did not take long until we found something else that we liked just as much.  $6000 in savings later, we have a new bed. 

Don’t be afraid to shop around.  The $6000 that we did not spend because we looked around is staying in the bank and being put towards a down payment on a new home.  A much smarter investment.

Buy 2 for $3

If I go to the store to buy 1 avocado, I often see a deal for “Buy 2 for $3”.  I do not need two, I only need one. Very often you only need to buy one to get the savings.  Instead of costing you $1.75 for just one, you will only pay $1.50.  don’t fall for this trick.

So, You Got a Rebate.

So you took the time to send in your mail in rebate.  For the last 8 to 12 weeks you’ve been thinking about how you are going to spend that money.  It is going to come as a debit card that you can spend any way you like.  The excitement builds as the day approaches.  You cannot want to feel that cool piece of plastic in your fingers. You dream about sliding that card in the machine and buying something.

So what is the problem with that scenario?  The problem is you are thinking about wasting that money.  Many companies offer rebates to get you to buy their products.  If you are lucky enough to find for a product that you need without strings attached, get it!  Many companies offer rebates knowing that you will most likely not send in the rebate.  They anticipate increased profits based on laziness.  First off, get the rebate.  Second, spend it wisely.  Spend it as if it is already part of your budget.  You received a $50 rebate card and you have a monthly grocery budget of $400, apply the rebate to the grocery budget.  Let’s see, $400 budget plus $50 rebate = $400.  That is right, merge it into your budget not increase it.

Folks this is free money.  Do not blow it on items that you do not need and have not budgeted to purchase.  I’ve watched my shipmates in the Navy get thousands of dollars unexpectedly, only to blow it within days on garbage.  One person even purchased an expensive SUV, only to not be able to afford the monthly payments.  What a waste. Lost everything.

Be smart when free money comes around.

What to do with a Military Discount

A few weeks back, I posted an article for my brothers and sisters in the armed forces to encourage them to use their military discounts.  Here is a question, what do you do with the money that you save?  Here is one suggestion that I am doing….bank it.
For my personal retirement, I have a minimum contribution of $50. I take a look at each receipt that I have and keep a running total of my military discounts.  It may be $.50 here, a $1.25 there.  In the end, it will add up.  What you do with this discount is very important.  Let’s say my discount adds up to $50, three times a year.  Let’s also say that I put that in a mutual fund with a small, 5% annual growth rate.  Take a look at what you will get:

Starting Age	Years until you can collect a military retirement	Total
18	42	$28691
20	40	$23791
25	35	$15369
30	30	$11065
35	25	$7961
40	20	$5542
45	15	$3657
50	10	$2189

How much did this cost each member?

Starting Age	Cost	Gain	Growth
18	$6300	$22391	78%
20	$6000	$17791	74%
25	$5250	$10119	65%
30	$4500	$6565	59%
35	$3750	$4211	54%
40	$3000	$2542	45%
45	$2250	$1407	38%
50	$1500	$689	31%

It clearly shows that the earlier you smartly invest your military discounts, the more money you will have at retirement.  Do not rely completely on this method.  Remember to contribute to your Thrift Savings Plan as much as you can.  The more you put in early in your career, the more you will be able to enjoy your military retirement benefits….like world travel.