Photo by: nertzy
While retailers count on the holiday shopping season every year to start building their profit for the year, they do everything they can to keep you coming in year-round. Sometimes the deals they propose are actually bargains, but commonly they’re nothing more than a ploy to take your money. Keep you wits about you and examine the offers before taking the bait otherwise you may fall victim to their wiles.
“Future Purchase” Coupons
One of my biggest pet peeves with stores lately are the coupons that print at the register that are good for a certain percentage off a few days in the future. Craft stores, such as Michael’s, are notorious for this practice. I was just in there buying a birthday gift for my wife on Friday [Hi, honey!] and along with my receipt, I was presented a “20% off one regular priced item” coupon that was good for two days starting the following Wednesday.
They do this for one reason: To get you to return more frequently and give them more of your money. Yes, if you plan to be in there regularly anyway, these coupons can be a good deal. But if you are a casual shopper in that store, those coupons are barely worth the paper they’re printed on. They want you to feel like you’re losing out on something if you don’t cash it in, but don’t fall for their trap. A deal is only a deal if you were planning to spend money on it anyway. Otherwise, you’re just wasting your money buying stuff you didn’t plan to buy.
Store Credit Cards
It seems that just about every major retailer now has their own branded credit card. There are promotions galore for discounts for using those cards and cashiers are coached and paid bonuses to hawk it at every possible opportunity. They’re a great deal for the stores since they give them an opportunity to track your spending habits and encourage you to keep coming back by rewarding your “loyalty.” For you, they may or may not be such a great deal.
If you have good credit already and do a good job of managing your money and spending habits, signing up for a store credit card for the bonuses is not a bad deal. For example, I have a Lowe’s credit card that I use to get a 0% loan when I have a big purchase to make. And my wife has a Kohl’s and a JCPenney card for the rewards and pays off the balances every month (and most months those balances are $0). If you have poor credit, plan to need access to your credit soon, or you’re not that great about controlling your spending, a store credit card can be dangerous.
Direct Mail Incentives
This one falls directly in line with the store credit cards. When signing up for a credit card, you can’t avoid giving them your address and once the stores have your address, they will continually bombard you with fliers and sales ads to encourage you to return. Many times we’ll see two or three “Bonus 20% Off” coupons stuffed in our mailbox from various stores and almost all of them will proclaim that it’s a limited time offer. Apparently, they forgot that the coupon they sent last week and for each for the six preceding weeks was also a special, one-time-only, limited time offer.
Sometimes these coupons will be a good deal. I cherish the times when Lowe’s decides to send me a $20 off coupon. But other stores, like Bed, Bath & Beyond send 20% off coupons nearly every week. When a store frequently sends you the same coupon it’s a sign that their prices are always drastically marked up and shopping there would the coupon will only get you near the regular price. When they’re rare, as in the case with Lowe’s, it can be seen as a reward and a true bonus to bring you back. Avoid the stores that always have a coupon in your mailbox and cherish those that make it a true incentive.
Layaway
Layaway is, in simple terms, “credit for people who don’t have credit.” Instead of paying for your purchases and leaving the store with your merchandise, you go to the layaway counter and give them a fraction of the total due for them to hold it for you. Later, you can come back and pay more, but you don’t get to take the items home until you’ve paid off the balance.
At the surface, it looks like an ok deal since you’re not paying finance charges, but really layaway is just an interest-free loan to the store and you get nothing in return until the entire loan is paid off. You’d be better served to save your money, earn a little interest on it, and buy the item outright when you’ve saved enough. Why give away your hard-earned money for nothing?
Tricky Return Policies
Once they have your money, stores will do nearly everything they can to keep it. While many stores have recently started easing return policies in a return to customer-service oriented practices, they had been getting trickier and more restrictive over the last few years. Target, for example, has been called out more than once for changing and tightening their return policies. While corporate claims this is to reduce losses from professional shoplifters, it also pains their real customers by making it difficult to get what they want for their money.
Before shopping at a store, be mindful of their policies. Depending on how you paid for the purchase (cash, check, credit card, etc), their return policies may vary. As always, keep your receipt because returns without a receipt are becoming more and more difficult and restrictive. And just because store policy says one thing, managers are often given a little wiggle room to deal with customers with real problems (and problem customers). If you think you’re being cheated, keeping your cool and asking for a manager is your best chance of getting your true money’s worth.
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