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Tuesday, June 30, 2015

The Impulse Buy

Posted by Tim Stobbs on February 17, 2015

I looked at my hand in confusion and was almost in shock.

“Did I just really do that?”  I asked aloud.

I look at the screen again.  “Yep”

I just bought a ebook on impulse.  Oh my, is the world ending now?  But wait this is the second impulse buy I’ve done in the last two months. I bought a DVD on impulse in January. Will I be struck down by a vengeful god?

Nope.

But in all honesty, both events were highly unusual for me.  I’m so used to doing just about everything via delayed gratification that when I impulse buy I’m a bit rusty at the experience.  It’s much more normal for me to consider a purchase for a while and then after a week or two finally buy it or not.  At least when it come to consumer goods.

Food on the other hand I’m practically an expert in impulse buying.  Most of my lunches out at work are not planned.  In the grocery store I often pickup one extra item that I want, but don’t need and wasn’t on the list.

How do I justify this Jekyll and Hyde on my spending?  It’s simple…I planned it this way. WTF?!?!

I know after many years of trail and error my week point in spending is books and movies.  As such I tend to plan those purchases out a long time in advance.  Typically at a minimum a few weeks, this tends to keep down the amount of both items I buy and forces me more often than not to use the library instead to try out something I’ve never seen or read.  After that if I still like the book or movie a lot and it has a high degree of potential for watching/reading again and again then I will consider buying it.  Even then I still tend to think about it for a while.

Yet exercising that degree of self control over everything I buy can be exhausting, so rather than try to control everything.  I focus instead on my main weak spots and big purchases.  Then I allow myself more slack when it comes to food purchases that I make with my spending cash.  Buying a cookie because I want one isn’t a major issue so I’m not going to turn into one.

In the end, the impulse purchases above were notable since they were from my typical weak points of spending.  To me it was a clue to watch myself a bit more in the weeks ahead to ensure I don’t slide into my old patterns of buying too many books and movies.  Yet both purchases did point out something interesting to me.

The movies purchase was in fact season one of a TV show I had borrowed from the library and enjoyed a LOT.  So when I came across it for about half price I decided on impulse to buy it.  Do I regret it after the fact? Nope, not really.  This brings up an interesting point for me. Should I consider the occasional impulse buy being okay if the item in question I would have purchases anyway and it is on for a deep discount? While this has the potential to be a slippery slope, I think I will allow myself a bit more latitude on these items in the future.

The second purchase of the ebook also brought up an interesting point.  We had two older gift cards (like months old) in the house with only a few dollars left on them.  My wife had just finished buying some ebooks and used up one of them.  So I took a look around and bought an ebook on impulse to use up the other gift card.  I found one that looked interesting and was rated fairly good on Goodreads.  What this showed me was I tend to have a disconnect around gift cards compared to actual cash, since I don’t think I would have bought the book if I had been paying with my credit card.

That particular effect is rather well known in academic circles as the pain of paying (see here for a description from Dan Ariely).  The more disconnected we are from cash the less careful we are with the money.  In the world of pure reason, a $1 on a gift card is exactly the same as a $1 cash but in real life we treat them differently.  We are more willing to spend a gift card than cash.

I had thought since I knew about this issue that I had made so progress on overcoming it…while the ebook purchase proved me wrong on that front.  Ugh.  Anyway, lesson learned I need to keep up the controls about spending especially with gift cards since I tend to be a bit more lose with spending them.

In the end, an impulse buy is only bad if you treat it that way.  You don’t have to control yourself at all times, but I do recommend some rules of engagement that you create for yourself to help you out with your problem areas of spending.  It won’t be perfect, but it should help cut down on the junk purchases in the long run.  Just don’t freak out when you break your own rules…use them instead as a means to learn why you did and if any changes are required.

How do you manage your impulse buying?  Do you use any rules for it or not?

In and Out

Posted by Tim Stobbs on December 29, 2014

Ugh, Christmas is over.  The presents are unwrapped, you have setup, washed or otherwise started to use your new gifts.  Good for you.  Now on the flip side what are you getting rid of?

Pardon?!? All to often we get new stuff in our lives and don’t even give it a second thought that perhaps this would be an excellent time to also consider getting rid of a equal number of items to ensure your pile of stuff doesn’t grow.  I personally try to get to this the week following Christmas.

In some cases, this is a very easy thing to do.  For example, I got a new pair of jeans and tossed an old pair that I had previously fixed a hole in the pocket of.  The rest of the jeans were also starting to wear out so it was an easy decision to make.  Heck while you are in your closest you could just do a check in to see if you actually wear everything you have in there.

Other things are a bit more complex, like we got a new Keurig coffee maker for a gift.  So does that mean I should toss out my old coffee pot.  Perhaps, but I also use that coffee pot a LOT right now.  So in this case, I’ll take a wait and see approach to decide if I will use one more than the other and if I should get rid of something in the future.

Giving stuff and receiving it is easy to do.  Getting rid of things isn’t always so easy especially if you have problems tossing perfectly usable items (like I do).  So I tend to use the following methods:

  • Give it to a friend. In some cases, you might have someone else who can use something you used to have and they would love it.  When this works out it is wonderful for everyone.
  • Donate it. Nearly perfect used clothes are easy to donate and so are small household goods to some charities.  Other things you have to consider if it would be really useful since it is fairly won.
  • Sell it. Online sites make this significantly easier to do now and you can also give something away for free if you do not feel it would be worth selling.
  • Or if you just can not find a way to get rid of it…throw it away. I hate to do this, but accept sometimes I can not find something a home.

So do you do a post holiday purge?  If so, how you do handle it?

And Then a Funny Thing Happened

Posted by Dave on December 23, 2014

A couple of weeks ago, I talked about my wife’s and my decision to not give Christmas or birthday presents to each other (We both have December birthdays, on the 13th and 16th). Normally, the act of both searching for and then going to purchase presents causes a fair amount of work and time, and usually leads to both of us getting things that we kind of don’t want and causing quite a bit of unrequired stress in dealing with people at shops and malls, for the sake of consumerism. For my birthday, we went to our favourite pub for lunch and a few drinks (it fell on a Saturday this year). My wife chose a lunch at a new sushi place to celebrate her birthday when we took this past Friday off to relax for the day, before family Christmas insanity takes over the next few weekends.

I’ve noticed over the past couple of weeks, rather than fretting over presents, I’ve been having a much better time. I’ve made a few (admittedly small) donations to charities, something I normally wouldn’t do (Heifer International and The Salvation Army), because of my limited budget this time of year. I donated to Heifer International after reading a very passionate request for donations from Patrick Rothfuss, one of my favourite authors. He felt so strongly about the charity that he agreed to kiss whatever kind of animal people voted on that the charity provides to people they are helping (llama, pig, heifer, or goat….he ended up kissing a llama).

Over the years, I have slowly but surely tried to minimize most things that cause me annoyance. My wife and I have started spending more time at home, rather than running all over the province every weekend – we liked the visiting, but we didn’t enjoy being exhausted for the first few days of the week. We also made our “budget” as easy as possible to follow – in the attempt to eliminate money issues coming up monthly.

Our Early Retirement plan is sort of the last “problem” we’re attempting to overcome. We’d like to do exactly what we want to do, rather than trading a good portion of our time working. There are hobbies and interests that we have to set aside for the 10 hours a day we’re either working, getting ready for work, or getting home from our jobs. We’d much rather have this time to ourselves.

We’ll continue looking for areas to make our lives a little easier, either by doing more of something, or a much less. Is there anything you’re planning on changing in the coming year to make your life a little easier?

Merry Christmas and Happy Holidays to everyone, all the best to you and your families!