When you’re trying to save money, buying coupons from “daily deal” sites may seem like a great idea. But if you’re already handling too much debt, these deals could put a serious dent in your budget—and potentially jeopardize your larger financial goals.
Consider the following information when looking at daily deal sites:
1. If you’re in debt because you overspend, daily deal sites could get you into more trouble. Someone who used to buy a lot and now is purchasing less to save money may start to feel deprived. Sites offering daily deals could provide a sort of adrenaline rush for those shoppers, says Shannon Ryan, CFP®, president of The Heavy Purse finance blog.
“Daily deal sites feed right into the personality of people who want to buy stuff. They know what entices people,” Ryan says. “The impulse to purchase can be very hard to control.”
2. Beware of price inflation. While there are sometimes great deals on these sites, many of the so-called “deals” are red herrings, Ryan warns. If you look elsewhere for the same item being sold on a deal site, you might find that the discount often isn’t as steep as reported.
Marc and Tyler Horne, co-founders of the DailyDealBuilder.com, a provider of daily deal software, solutions and sales training, say that many businesses have been caught inflating prices on their promotions to make the sale price look better than it is. They advise that shoppers check to make sure the deal is what it seems to be.
3. Avoid impulse items with short purchase windows. Some deal sites warn that the low price is only good for another few minutes—or even seconds. When this is the case, shoppers often feel pressured to make a quick decision for fear of missing out on a great deal. More often than not, however, these are unnecessary purchases, Ryan says.
“If you use discretionary money for these quick things that don’t make you happy, you’ll probably go out and buy the thing that you really wanted anyway,” she says.
4. If you do buy from a daily deal site, be sure to actually redeem the coupon. Daily deal sites depend on a certain percentage of people not redeeming the vouchers they purchase because the sites make more money that way, Marc Horne says.
“Especially if someone is trying to save money or get out of debt, it would be bad if [he or she buys] a deal and [doesn’t] actually use it,” Horne says.
Buyers should keep in mind that in most states, vouchers that have expired are still worth whatever you paid for them, Horne adds. So, if you spent $20 on a voucher for $40 worth of goods, the voucher is still worth $20 after its expiration date.
That’s better than a total loss, but it wastes the value of the deal. Instead, buyers may want to pay attention to expiration dates and use their vouchers in time.
5. You can always unsubscribe. By law, all sites are required to send an unsubscribe link with every email, so if you find that you’re spending too much money on daily deals, you could stop them from coming to your inbox with just a click on that link, which will allow you to unsubscribe without reporting them as spam, Horne says.
In many cases, shoppers can also tailor deal alerts to their specific interests, such as only spa deals or only clothing deals, Horne adds.
6. If it wasn’t in your budget to begin with, you probably don’t need it. If it just so happens that you’d planned to spend discretionary money on a pair of boots and a daily deal site offers you the best price for those boots, that could be a good time to purchase the deal, Ryan says.
If this is the case for you, try turning on deal alerts only until you’ve gotten the deal for which you searched. Then, turn the alerts back off so you’re not tempted to make unnecessary purchases.
Megan Craig is a Chicago-based journalist and communications professional who writes mostly about personal finance and consumer issues. She is a former reporter and editor for the Chicago Tribune. Follow her on Twitter @megcraig1.
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