Saver or Spendthrift?

You are at a department store and find a gorgeous sweater marked down from $65.00 to $40.00. What a great deal! Do you

A. Snap up the plastic and buy it before someone else gets it?
B. Find another sales rack and buy a less attractive sweater for $30.00?
C. Stop and think about how many sweaters you already have in your closet and decide you really could use that $40.00 somewhere else.?

All of you people who just answered A may be wondering how some of us manage to become a C. It's not impossible and can even be fun to manage your money. (Well, not fun like Disney World, O.K.)

What motivates a purchase? Do you shop when you're blue? If you know that's a coping skill, then don't set yourself up! Don't go to the Mega Bucks Boutique. Go someplace where the prices are reasonable and you won't replace the blues with guilt. Go to the dollar store. Yes, the all incredible super glamorous Dollar Store. I buy generic children's Tylenol, ($3-5)Band-Aids($2-4), shampoo($2-5), gift bags($2-3), all the trimmings for a birthday party($20-30), hair stuff for my daughter ($2-4), bath soap($2-3), cleaning supplies($2-4) and on and on. Think about paying the cost of these items in other stores listed in parentheses and then think-I only paid a dollar. It is amazing all the stuff people pay too much for and find on the shelves of these kinds of stores. Along with the good feelings someone gets when purchasing something expensive, there is a sort of a euphoria that can be felt when you save a significant amount of money on something. Better yet, later you don't feel guilty for saving your family $20 instead of spending too much on something maybe you didn't really need. It does cycle though into wanting to continue to save and searching for bargains can become a little bit of an addiction too!

My family also yardsales. As my kids get older, I know they won't go for "used" clothing and I understand that. I was a teenager once, too. But it you have small children (clothus destructis) they don't care. For a mall shopper, yardsaling might be right up there with sitting with the homeless looking for a handout, but it's not. It is economic good thinking and a great way to recycle. Think about it-pay $7.00 for that little shirt or .50. Simple math.

We buy at resale shops. You know long about January when your kids have gone through the knees of their jeans and the thought of re-outfitting them before spring seems a waste? This is the best time to buy jeans at resale. You are getting jeans at about the "October" stage of wear, which should wear through the knees at about shorts time. If your worried about other kids recognizing their clothing shop out of your area, but be realistic--when you bought that shirt at the mall how many more of them were sitting on the rack?

We also buy at large discount stores. Catch the sales at the end of the season and buy next year's size for the kids. It will be brand new and waiting for them when they're ready.

Ask yourself, why am I content to pay so much money for items that cost less elsewhere. What other things could I be doing with that money? Paying down my house note? Building my retirement? That sweater won't be here in 50 years but you probably will. It all comes down to priorities. Which is more important, being dressed in the latest fad today or securing your future assets. There is no need to spend like there's no tomorrow because barring the end of the world, and well that Y2K thing was a bust, there will be another day. Another day to pay credit card bills, light bills, and dentist bills. According to Consumer Credit Counseling you may be getting into debt trouble if your spending habits reflect this list.

• Your paycheck usually disappears before you receive the next one
  
  
• You are behind in your mortgage or rent.
  
  
• You have taken out new loans to pay old ones, or extended old loans in order to lower monthly payments
  
  
• You don't know how much installment and credit card debt you owe and you are afraid to add it up.
  
  
• You are near or at the top of your credit limit.
  
  
• You no longer contribute to a savings account or have any savings at all.
  
  
• You are usually late in paying some or all of your bills, or you put off paying some bills until next month.
  
  
• You've applied for more credit cards to increase your borrowing power.
  
  
• If you lose your job, you would be in immediate financial difficulty
  
  
• You post-date checks or hurry to the bank on payday to cover checks already written.
  
  

And if that's not sobering enough here's some statistics from the National Foundation for Consumer Credit website:

• According to a study by the National Foundation for Consumer Credit (NFCC), 89 percent of people surveyed said it was easy to get into debt because of the availability of credit.
  
  
• According to the Administration Office of U.S. Courts, bankruptcy filings for the 1998 calendar year reached approximately 1.4 million filings, or about one of 12 Americans.
  
  

This doesn't mean you have to deny yourself everything and go around in homespun clothes, but maybe try to curb some of those less healthy habits. They need to put a medically approved attachment for people's credit cards like they put on cigarettes. Just charge a little less every month and work on getting credit card balances down or eliminated. If you're on your feet enough not to have a balance then put that saved money towards long-term goals and investments. If you reach a savings goal, reward yourself---not with a lavish weekend in Vegas where you wipe out your savings and gamble away the ranch! I was thinking more along the lines of a hot fudge sundae or maybe even a new...sweater.

Teresa Higginbotham is also known as "Tightwad Tess". Contact her by email at tightwadtess@aol.com.

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