Finance expert reveals toxic spending habit that could be costing you more money
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With the holiday season just around the corner, it's natural for us to want to splurge on presents for our loved ones or for ourselves.
But while there’s nothing wrong with a little present shopping, it’s also important to be mindful of how much money you’re spending for a worry-free holiday season.
Fortunately, Amy Knight, a personal finance expert at NerdWallet UK, is offering tips on how to get through this Christmas season.
Knight explains the toxic shopping habit of 'spaving'.
‘Spaving’, a portmanteau of spending and saving, is shelling out money in the hopes of saving in return.
'This could include making several purchases on a 3-for-2 deal when you actually only wanted one of those items originally, or adding additional items to your cart to meet the threshold for free shipping,' she said.
'Overall, “spaving” can fool us into spending more than we want to, so it’s important to balance finding fun deals with genuine ways to cut costs and save money.'
Let’s discuss some of the common ways shoppers fall into ‘spaving’—and how to stop yourself from burning money in the long run.
1. Buy one, get one free
There’s no doubt that this 5-word deal has the potential to save us money, particularly during the festive season when gift-getting can get a little bit hectic and expensive.
But despite how attractive these deals may be, it’s important to remember to take a step back and think about whether you actually need the item you’re trying to get at a discounted rate, or if it’s just a fleeting impulse buy.
If you have good reasons for taking the deal, then Amy suggests snagging the bargain immediately.
But if you don't need the products on sale, she advises: 'Try to hold off on these additional purchases for a few days at least.’
'Then if you find you’re still thinking about that item, you can come back to it. If you can wait until the January sales, the price may have gone down.'
2. Free shipping
It’s a lifesaver, and many of us have fallen for the temptation of buying items that go over the minimum order amount just so that we can get it shipped for free.
Amy expressed, 'It’s only worth adding additional items to your cart to qualify for free shipping if, firstly, they are all items you want anyway or, secondly, if the item you add costs exactly the same as the cost for shipping. Ideally, you’re looking for both these things to be true.’
'Make sure you check whether there are a range of shipping options to choose from, as the default option may not be the cheapest.’
'If you’re prepared to wait an extra couple of days for your order to arrive you can sometimes cut shipping costs down considerably.'
3. ‘Limited time only’ discounts
We’ve probably all seen those tantalising 'limited time only' advertisements, and the thought of the deal slipping away can be enough to send us into a panic-buying frenzy.
But, before clicking that ‘Order now’ button, it pays to do a bit of research and make sure that the items haven’t been sold at the same price you’re seeing now–or even lower–for a while.
Price comparison websites are your friend here. These platforms can give you a view of the item’s price history, and you’ll soon realise whether it’s actually worth it or not.
4. Delete your saved payment information
Mobile payment technology is great, isn’t it? You can whip out your phone and pay for your item delivery with just a few taps, without needing to type out your debit or credit card details.
'I’d suggest you delete them,' said Amy. 'Either now or once you have found all your Christmas presents for loved ones.’
'Everyone knows it’s hard to squeeze in Christmas shopping alongside work and day-to-day responsibilities.’
'But time-saving tools like saved payment details can make it too easy to make a purchase without thinking it through.’
'Just putting that little obstacle in place of having to manually enter your details can stop you from buying things you don’t really want or need.'
5. Set a budget
Finally, Amy’s biggest suggestion is especially relevant in these uncertain financial times: set a budget.
Amy said, 'Many online banking apps now offer a feature where you can set a budget for yourself, split by categories such as health and beauty, and dining out.’
'When you approach the limit of your budget, your app will send you a notification to make you aware. You can also view your spending month by month.’
'It might be a good idea to look back over your spending last Christmas and see if there are any categories in which you feel you spent more than you intended to.'
‘Spaving’ can be easy to get caught up in, so establishing good budgeting habits and understanding what you can and can't afford will help you save more money in the long run.
Do you have other tips that you use based on your experience? Let us know in the comments below!
But while there’s nothing wrong with a little present shopping, it’s also important to be mindful of how much money you’re spending for a worry-free holiday season.
Fortunately, Amy Knight, a personal finance expert at NerdWallet UK, is offering tips on how to get through this Christmas season.
Knight explains the toxic shopping habit of 'spaving'.
‘Spaving’, a portmanteau of spending and saving, is shelling out money in the hopes of saving in return.
Shopping for loved ones this Christmas? Finance expert Amy has some tips for you! Image: Pexels
'This could include making several purchases on a 3-for-2 deal when you actually only wanted one of those items originally, or adding additional items to your cart to meet the threshold for free shipping,' she said.
'Overall, “spaving” can fool us into spending more than we want to, so it’s important to balance finding fun deals with genuine ways to cut costs and save money.'
Let’s discuss some of the common ways shoppers fall into ‘spaving’—and how to stop yourself from burning money in the long run.
1. Buy one, get one free
There’s no doubt that this 5-word deal has the potential to save us money, particularly during the festive season when gift-getting can get a little bit hectic and expensive.
But despite how attractive these deals may be, it’s important to remember to take a step back and think about whether you actually need the item you’re trying to get at a discounted rate, or if it’s just a fleeting impulse buy.
If you have good reasons for taking the deal, then Amy suggests snagging the bargain immediately.
But if you don't need the products on sale, she advises: 'Try to hold off on these additional purchases for a few days at least.’
'Then if you find you’re still thinking about that item, you can come back to it. If you can wait until the January sales, the price may have gone down.'
Try these tips from Expert Amy so you can still save while buying your gifts! Image: Pexels
2. Free shipping
It’s a lifesaver, and many of us have fallen for the temptation of buying items that go over the minimum order amount just so that we can get it shipped for free.
Amy expressed, 'It’s only worth adding additional items to your cart to qualify for free shipping if, firstly, they are all items you want anyway or, secondly, if the item you add costs exactly the same as the cost for shipping. Ideally, you’re looking for both these things to be true.’
'Make sure you check whether there are a range of shipping options to choose from, as the default option may not be the cheapest.’
'If you’re prepared to wait an extra couple of days for your order to arrive you can sometimes cut shipping costs down considerably.'
3. ‘Limited time only’ discounts
We’ve probably all seen those tantalising 'limited time only' advertisements, and the thought of the deal slipping away can be enough to send us into a panic-buying frenzy.
But, before clicking that ‘Order now’ button, it pays to do a bit of research and make sure that the items haven’t been sold at the same price you’re seeing now–or even lower–for a while.
Price comparison websites are your friend here. These platforms can give you a view of the item’s price history, and you’ll soon realise whether it’s actually worth it or not.
4. Delete your saved payment information
Mobile payment technology is great, isn’t it? You can whip out your phone and pay for your item delivery with just a few taps, without needing to type out your debit or credit card details.
'I’d suggest you delete them,' said Amy. 'Either now or once you have found all your Christmas presents for loved ones.’
'Everyone knows it’s hard to squeeze in Christmas shopping alongside work and day-to-day responsibilities.’
'But time-saving tools like saved payment details can make it too easy to make a purchase without thinking it through.’
'Just putting that little obstacle in place of having to manually enter your details can stop you from buying things you don’t really want or need.'
5. Set a budget
Finally, Amy’s biggest suggestion is especially relevant in these uncertain financial times: set a budget.
Amy said, 'Many online banking apps now offer a feature where you can set a budget for yourself, split by categories such as health and beauty, and dining out.’
'When you approach the limit of your budget, your app will send you a notification to make you aware. You can also view your spending month by month.’
'It might be a good idea to look back over your spending last Christmas and see if there are any categories in which you feel you spent more than you intended to.'
‘Spaving’ can be easy to get caught up in, so establishing good budgeting habits and understanding what you can and can't afford will help you save more money in the long run.
Do you have other tips that you use based on your experience? Let us know in the comments below!
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