Do you coupon?

Do you coupon? Do you ever wonder if couponing is really saving me money or am I just spending money on things I really don’t need?

There are researchers that state that couponing can be bad for you and can hurt your finances in the long run.

Like ever good thing, there are pro’s and con’s to couponing.

Let’s take a look at some of these con’s in couponing.

Coupons can cause impulse buying. When shopping especially for groceries it is always recommended to use a grocery list so you don’t over spend. But most people that use coupons will usually make purchases of items that they have coupons for. You may not have a need for the item but because you have a coupon for it you purchase it.

Junk food. Studies have shown that a large portion of online coupons are redeemed junk food and candy.  If you are trying to diet then couponing might not be good for you.  

Processed foods. If you are into purchasing processed food then couponing will be good for you. Studies have shown that many of the coupons in papers and online are for processed foods like frozen pizzas, tv dinners and other frozen of frozen food. These prepackaged foods are typically higher in sodium, fat, calories and preservatives. If you are into making your own meals with fresh products then couponing may not work for you.

Unhealthy drinks. Most coupons for soda’s and energy drinks may  be appealing to people that don’t drink a lot of water. Most of these drinks are high in sugars and caffeine. 12% of coupons are for drinks that are not really good for you.

Online coupon. I do a lot of computer repairs and virus removals from computers. I find that several of the computers I have worked on removing viruses the people got the virus from couponing sites. I try to tell the people to not use these sites, many of the stores don’t take coupons from these sites anymore and the sites seem to be loaded with computer viruses. A local restaurant chain I just visited would not take a coupon I had found on my smart phone. The owner said that there has been several sites that make online coupons to look like real coupons but they are a scam. So even stay away from couponing on your smartphone.

There are some good to couponing if it is done correctly. I just advocate that you be careful and not overspend and purchase things that are not needed when using coupons. If you use coupons correctly you can diffidently save some serious money, we will take a look at this later on in a different post.

But like everything there is both pro’s and con’s to couponing. Just be careful and don’t get taken by some of the scams that are out there in couponing.

Take time when making a major purchase.

How often do you ever think of what you are purchasing before you buy it? I try to take a couple of days before I make my purchases.  I am talking about groceries and essentials but what I am talking about  are things that I am wanting and not really needing. For an example I just bought a fishing pole. I saw the one I wanted and the cost of it was $150.00 but before I purchased it I went to the store to really make sure that this was the one that I really wanted. I really thought this was the one that I really wanted, but before I would spend that kind of money for a fishing pole I would check around at a couple of other stores before spending that kind of money. I went to a couple of stores and I found one that was just as good if not better for $60.00. Now if I was an impulse buyer I would have wasted $90.00 on something that is just as comparable as the one for $150.00.

I was really glad that I did not purchase the one for $150.00 even though I would have liked it very much but if I would have purchased the more expensive one then I would have had buyer’s remorse when I saw the one for $60.00. We have all had buyer’s remorse at one time or another. I find that taking my time when purchasing things I can usually avoid getting upset for spending extra money on something that I could have found cheaper.

Here are a few questions that I ask myself before I make purchases.

Am I just making this purchase because of emotion or logic? You should never make a serious purchase just out of emotion. Most of the time when you make a purchase with just emotion then you will probably regret the purchase later on. For an example you are walking through a store and a new television catches your eye and you make the purchase just because you get attached emotionally to the item, then a week later you get hit with the credit card bill you forgot about and you don’t have the money to pay for it because you spent it on the television. You let your emotions get the best of you and you did not think the purchase through all the way.

Do I really need this item? I ask this question at every purchase I make. A lot of times I find that the purchase is a want, so I weigh out how much enjoyment am I going to get out of this item. Wants are fine as long as they will give you plenty of enjoyment over the years.

Do I have the spare money for this item? I will not make a purchase unless I know for sure my bills are paid and there are enough funds in my account for any emergency that may come up, If I have any question about whether my bills are paid or not then I will hold off on the purchase until I know for sure that all my bills are paid for the month.

Have I done my research on the item? I will not make any purchase until I have shopped around to make sure that I am getting the best price. There are many times when you can make the purchase online. Most of the time by shopping online you will save money on gas and time. Again by not being an impulse buyer I save a lot of money by shopping around. 

In today’s times it is hard to save money and we are all trying to become financially independent. We all need to make our purchases smart and wise. Each purchase needs to be thought through and analyzed to make sure the purchase is the right decision and we are getting the best price for it.

Set Up an Emergency Fund

A very common question that keep's popping up when talking to people about finances is “How much money should I set aside for emergencies”?  This question has many variable answers but when I did my research most financial advisers suggested to start with a goal of three months. But the ultimate goal would be to have six months of income set aside in an interest bearing account.

I would shoot for the six month goal in order to give yourself a good cushion to fall back on if an emergency arises. Back about twelve years ago I was laid off work without any warning sign or knowledge of it coming. I was out of work for six months but thankfully I had six months of income set aside, if I did not have this cushion I and my family may have ended up on the street without a roof over our heads.

Back in 2008 during the great meltdown of the economy many people were without work for long periods of time. With the economy today and the unstable governments in other countries the American economy is very fragile. At any given moment we could have something major happen here in the United States and our money system could have a major collapse and people would be out of work and have no income. Having a nice financial cushion of money set aside makes life a lot easier and less stressful if you find yourself like me out of work for any given period of time.

The truth is that anything could happen to anyone of us at any given moment. We could find out that we have some major illness, or we get into a car accident, your spouse dies out of the blue, etc.  One just never knows what may happen at the blink of an eye. We are not guaranteed our next breath. My best advice is, be prepared and if you are not then make it a goal to get yourself prepared.

Let’s look at how we can get this started.

You first need to know what your bills are. You need to take some time and sit down and write out what your fixed monthly bills are, this way you will know what your fixed expenses are. Now figure out what your variable expenses (gas, groceries, entertainment, etc.) are.

Once you know what your total expense picture is you can then determine how much money you will need to save. Take all your expenses and multiply by three for three months emergency fund or six for a six month emergency fund.

To set up emergency account correctly do not try and save the money in your checking account. I have tried this and if it is sitting where it can be seen you will spend it, trust me. Set up another account preferably with another financial institution like a credit union and make sure it is an interest bearing account.

Be extremely disciplined to get this account filled up, this is a very important fund and needs to be handled as a do not touch me account. Only draw money out of this account for emergencies only. You can decide what you call an emergency; some examples would be car repairs, hospital bills, money to live on if you or your spouse loses their job, things like this. Not vacations or money for a down payment on a new car.

No one expects to lose their job, I didn’t twelve years ago, but things happen. That is why it is wise to have this emergency fund set up and the fund filled as soon as possible. It is better to be prepared then to be caught with empty handed and you and your family be caught in a financial disaster. But if you do have an emergency and you have an emergency fund set up then you can sleep at night soundly if you are prepared.