Sharing Daily Discoveries About Personal Finance And Business Topics

Viewing Your Earned Credit Spending As Not Free

A person was telling me today that they purchased a new kitchen appliance where they were hoping to hold off for a good deal but ultimately they realized that they needed one now and so they bought the first one that they saw at a semi decent price. The one they actually wanted was about $25 and this one was over $40. Here was the funny thing though as I was saying I could have gotten them that $40 one for about $35 with a special coupon. The person’s response was that they paid about $20 as they used up their $20 store credit from all their other past purchases.

If you think about it that’s not really getting a discount at all since they spent store points and is different from using a coupon to knock down the regular price. Like in this case even with their credit they would have spent a total of $15 instead. But it amazes me as this is actually pretty common where financially in many people’s mind they treat using the store credits that they spend a ton of money earning as if that is a discount when they actually use it.

That is an error I feel because it often gives people the false assumption that they are saving money. In many cases if there is say a jar of peanut butter for $5 that is normally $3 then that is a bad deal despite the store credits you may have. Yet like there if a person used $2 in store credit on the inflated price they think it’s a great deal. The simple solution to that is to simply treat your earned credit and reward money as if it is no different than the money you have in your wallet. If the item isn’t a good deal without it then you may want to rethink the purchase in the effort to get the best value for your hard earned dollar.

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