Loose Change Random bits of information to add coins to your wallet and wealth to you life. Sun, 15 May 2005 13:02:08 -0500 http://web.extension.illinois.edu/lmw/eb363/rss.xml HELP! I need a MAP to navigate prices! http://web.extension.illinois.edu/lmw/eb363/entry_9480/ Wed, 21 Jan 2015 10:36:00 +0000 http://web.extension.illinois.edu/lmw/eb363/entry_9480/ Have you noticed that the prices of certain popular items are the same EVERYWHERE? They either never go on sale or when they do, everyone has them for the same price. It is enough to drive serious bargain hunters crazy. Related, but not quite the same, is trying to comparison shop for computers. No two retailers have the exact same equipment with the same amount of memory, speed, or storage space. When you try to compare it is difficult at best to see who has the better deal.

If you think this feels like a conspiracy against shoppers, you are not alone. It is MAP or price mapping- a little known strategy used by manufacturers to control the advertised pricing for their goods. Minimum Advertised Price policies are regulated by the Federal Trade Commission and are allowed as a means of leveling the playing field for all sellers. It is especially important online where lots of pricing information is available at your fingertips. Most consumers might argue that this practice stifles competition. Price mapping allows small businesses to compete with big box stores by avoiding price cutting wars.

Manufacturers are allowed to control the prices that are ADVERTISED for their products, not the price they are actually sold for and this represents a loophole in the law. Retailers who advertise an unauthorized price risk not getting the merchandise they are advertising. This could create a situation where they run out of a particular item or not able to carry it at all causing ill will amongst their customers.

So how do retailers get around this and how can the consumer benefit? As I mentioned before, it is only the ADVERTISED price, not the selling price that is regulated. Since the manufacturer pays for most advertising under a "co-op" arrangement, retailers will often turn to their online component with an enticement of a price "too low to show" and you then have to put one in your shopping cart to see the actual selling price. Other phrases include "see details at checkout", or "see price in cart." Remember, until you enter in a method of payment and approve the purchase, you are not actually buying the item. Just beware that you do not click on buttons too fast or you might find yourself unintentionally buying an item. I have done that-clicked too fast and purchased a year's subscription I only wanted for a month (I did get the order cancelled and a refund but it took several emails and a couple of weeks before the money was credited to my account).

As a shopper, I find it particularly frustrating to have to put an item in a virtual shopping cart before I can see the sale price. This is especially true if it is at a place I have not shopped regularly and I have to establish an account or put in personal information before getting to the final price portion of the shopping experience. However, doing more exploring, I am finding that sometimes the extra hassle is worth it. If I am just trolling online…I probably would not go through the hassle, but if I am looking seriously for an item, I am now willing to go the extra step. I have found some serious savings this way.

One more thing, because these are not advertised prices, they will not show up in price comparison tools, so be sure to do a little extra digging before actually purchasing.

The old saying "time is money" is certainly true here- spend some extra time and reap the savings!

Oh, and put the money you saved into a savings account!

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Paying Off Christmas Can Cost More Than You Think! http://web.extension.illinois.edu/lmw/eb363/entry_9454/ Mon, 12 Jan 2015 16:55:00 +0000 http://web.extension.illinois.edu/lmw/eb363/entry_9454/ Paying off Christmas can cost you more than you think!

Christmas is barely over and the bills are about to come rolling in. How much did you spend? I will admit that I spent more than I had planned, even though I had a spending plan in place. My biggest pitfall was Christmas dinner for 18- it was our first in our new home and I wanted everything to be perfect- from the decorations (inside and out) to all the food on the table. It did not help that I got sick and had to cancel dinner for 18 people! I paid cash for everything and did not use credit cards so I only have a couple of lean weeks until my next payday. How long is it going to take you to pay it off? More than half of Americans will have Christmas paid off by the end of January. A little over half of us pay cash or use credit cards and pay them off right away. Some use credit cards to get rewards for their purchases even though they have the cash. For the rest, Christmas, on credit will cost more (in interest) and take months to really be over.

A 2013 survey from Credit Donkey (www.creditdonkey.com), a credit card comparison company, indicated that of those who use credit and do not pay the bill off by the end of January:

  • 23% will pay by the end of tax season,
  • 13% by the end of the summer,
  • 6% by the beginning of the next holiday season and
  • 6% past the end of the next holiday season.

When taking that long to pay off the bills, you can spend so much more than the original gift is worth.

There are several different strategies to pay down that credit card debt.

  1. Pay more than the minimum monthly payment on your credit cards. Paying only the minimum monthly payment for your Christmas purchases, it will take you four years to pay off this Christmas. The average American would need to add $64 dollars a month to their minimum payment in order to pay off their Christmas credit debt before next Christmas. The sad thing is, when taking that long to repay this year's holiday expenses, there is no opportunity to save for the next year. So the cycle tends to repeat itself.
  2. The ideal solution is to pay off the Christmas expenses as soon as possible and then take the money you would be paying on the credit cards and deposit it into a savings account. Come December, you could have all or most of the money you need for the 2015 holiday season.
  3. Budget for next year-NOW. For those who paid cash for holiday spending, use this strategy to avoid the annual drain on your monthly budget. Total up all your expenses from the past holiday season. In addition to gifts, make sure to account for decorations, additional food, travel, and clothing for events, anything that was related to the season and, generally over and above your normal monthly budget. You may be surprised at the total. Divide that amount by 11 (now through November) and save that amount every month in a savings account. Come December- you will have all the money you need when the spending season comes around. If you decide to use a rewards credit card for your holiday purchases, be sure to check the balance often and pay it off at least by the end of the month if not more often.

The internet is filled with all kinds of savings plans that will "change your life". There is no credible research about which savings plan works the best. However, research does prove that changing behaviors, i.e. creating new positive habits, is the key to reaching your financial goals. Whatever method or savings plan works for you is the one you should work on.

What is your favorite method of managing holiday expenses without breaking the budget? Post them in the comments below.

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Welcome to Loose Change http://web.extension.illinois.edu/lmw/eb363/entry_9420/ Wed, 07 Jan 2015 16:58:00 +0000 http://web.extension.illinois.edu/lmw/eb363/entry_9420/ Hi! I am Pam Atkinson and I am the Wallet Warrior. I am starting a campaign for wealth and I would like you to join me. No, this is not some get rich quick scheme or how to make lots of money from your home without doing much work. I am here to clue you in on the little things that may save you a few dollars or some cents. When added up, these small changes can add up to significant financial security.

I saw a joke on line recently that said wealth…it's just simple math. That is true- if you take care of the simple math in your lives, you can gain enough extra money to hire someone to do the hard math for you.

Financial stability is having enough resources to be able handle unexpected expenses in life, generally without having to resort to credit cards-although credit cards, used responsibly, can be a financial resource. The actual amount varies from financial expert to expert with some saying you can handle an expense of $400 to $1500 as being minimum. I believe that amount is different depending on your personal income, resources and lifestyles. Some may find a $50.00 expense sends them over the edge and others can handle thousands. No matter what dollar amount sends you over the edge financially, I want to help you get to the point where you feel you have a bit of breathing room and can work on all the other savings "musts", an emergency fund for living expenses if you must be off work, retirement, or college for your children. The list is as endless and personal as you are.

Like with any new project, it will take practice and baby steps to learn the necessary skills for you to become financially stable. That is where this blog comes in. Loose Change will be a collection of news, savings ideas, resources, stories from readers, and new skills that you can use to help yourself set goals and take the steps necessary to become financially stable. I would love to hear your comments, questions and stories- both successes and setbacks. We are human and are bound to have challenges as we travel this road together.

So fellow warriors… what is it you want to do financially this coming year? What do you want to know? Leave your thoughts and questions in the comments below and we can work on them together in coming blog posts.

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