Image courtesy of Stuart Miles at FreeDigitalPhotos.net
“Well, hello stranger!” said a loud voice from somewhere behind the Subway counter. I quickly found the familiar face smiling back at me. It’s the same young lady that is working at the nearby Subway most Saturdays when I stop in to get lunch for my family. Saturday Subway is a tradition of sorts at the Pizel household. As the cashier rang up my sandwiches, she asked me if I wanted to get one of my sandwiches for free by purchasing a $20 gift card.
I politely declined. Buying the gift card would violate three of my foundational spending guidelines:
- It’s not a good sale if you weren’t going to buy it anyway. Each Thursday and Sunday my wife and I sit down and discuss how we’re going to spend our money. Saturday Subway is something we purposefully budget for. We budget $20, since that will cover the cost of buying four sandwiches (we save money by combining with chips and soda we have at home). We did not plan for a $20 gift card; therefore buying one would cause us to break our spending plan, and our budget.
- Buy only what fits in your budget. Here’s an example: Peanut butter is something we use often. But when I buy it, I usually pick up the smallest jar of peanut butter available. The smaller jar is a little more expensive per ounce, but the real cost is less than half of the larger jar. In my opinion, buying the larger jar of peanut butter would take a disproportionate percentage of my overall weekly grocery budget, making it difficult to get everything I need for the week with the funds available.
- Do not buy anything impulsively. The cashier put me on the spot to make a spending decision without time to really think about it. Making spur of the moment purchases is one of the reasons I found myself deep in credit card debt. Our purchases are now planned and purposeful.
If these things sound a little nit-picky, stick with me here for a minute.
We’re not talking about an earth shattering amount of money here. Throwing down an extra $20 to buy the gift card could have easily been taken out of our entertainment funds for the weekend and it wouldn’t have been a big deal. I almost justified doing just that in the name of saving the $5 for one of our sandwiches. But whenever that voice starts chirping in my head to go a bit off course, I remember something that my son’s baseball coach said a couple of years ago:
“You play how you practice.”
In other words, the way you do things when it doesn’t matter is exactly how you’ll operate when the stakes are high. If I veer from our basic spending guidelines and talk myself into spending extra money when it’s a simple $20 gift card, I’ll be able to more easily talk myself into spending extra on the next vacation, or the next vehicle.
The consequences then become hundreds or even thousands of dollars.
Being successful with your finances requires discipline. Whether it’s a $20 gift card, or a $30,000 vehicle, every purchase is analyzed, scrutinized, and must adhere to the same rules. Buying the gift card did not hold up to our spending guidelines, therefore the answer had to be, “No.”
When I got home, I told my wife about the gift card and suggested that we try to work our spending plan each week to pick up a gift card or two in the coming weeks, as the promotion will likely be around for awhile. The gift cards could be used as a Christmas Gift for a dice game we play each holiday season, or simply used towards the following week’s Saturday Subway.
If the purchase is planned and purposeful, then and only then can the answer be, “Yes.”
Do you apply the same rules to each purchase, or do less expensive purchases sometimes slip through?
I don’t think there’s anything wrong with sticking to your financial principles, Travis. Some people would say you should have purchased the $20 gift card for next week’s subs, but that could easily be a slippery slope. You have limits and you stick to them. Nothing wrong with that.
I’m a very structured guy, Holly….I need rules and structure. I have to apply the same rules to every situation, or I feel like chaos is closing in. It kind of goes back to the Gazelle intensity that I wrote about last week. I’ve got to be all in! Thanks for your comment, Holly!
I think it’s all those little small purchase that add up and get you. A magazine here, a soda there…those are the kinds of things where you look at your budget and wonder what happened. Congrats on having that strength and discipline!
Practice makes perfect, right my friend? If I can say “no” to a thousand little things, when that “BIG” thing comes along, I’ll be prepared. 🙂
“In other words, the way you do things when it doesn’t matter is exactly how you’ll operate when the stakes are high.” I could not agree more Travis! I think of it like how you act in those “small” moments matters much more than the big ones. If you go against what would be wise in the small ones then it’s going to be like dying by 1,000 paper cuts and you won’t even make it to the big one. That said, it can be very easy to talk ourselves into something, but success comes from that discipline of thinking through things to see if you really should do it.
I can talk myself into buying anything……what I like to do is try to talk myself OUT of spending money. It’s an interesting exercise…give that a try sometime. 🙂
Great job resisting……I have come to hate all the add-ons at the cash register “would you like to donate a $1, would you like to open a store credit card and save, would you like to sign up for our rewards program, can I have your phone number/email address” and on and on….
I know it isn’t the cashier’s fault, but sometimes I’d like to snap “how about you just ring up my item and I’ll give you money and our transaction will be over thank you very much”…..every exchange feels like a gauntlet that I have to run!
I remind myself that the cashiers wouldn’t be made to ask those questions if the store wasn’t making money on them…..resist, resist, resist!
Thanks for letting me vent!
I know exactly what you’re talking about, Den. It seems like we’re constantly being asked to donate a $1, or donate the change by rounding up, or being assaulted by fundraisers as you walk in or out of major retailers. Drives me nuts!
Purposeful spending for life is far more useful than a few temporary dollars or pennies of savings.
Exactly, Stefanie…..temporary pleasure vs a lifetime of financial progress!
My takeaway from this Travis is that you know your financial self. Your techniques may or may not be effective or necessary for others, but you’ve learned what you need to do to stay on track financially, and that’s huge. I think the lesson is we all need to do that–first, know yourself, honestly. Some of us can handle credit cards, and some of us can’t. Some can resist buying things we don’t need on sale, and some can’t. To succeed financially, we each need honestly to recognize our money strengths and weaknesses.
You definitely got my point, Kurt. I’m just relaying how we make things work for us….and if someone can take away a positive from my experiences and perspectives….well, that’s why I keep writing!
I was originally a little confused by your post. “Why is he touting that not getting the card was a good thing?! He already said he get’s Subway every week anyway. It will cover next week and he’ll be ahead of the game $5!”
But then I read to the end and realized that you are much wiser than I.
I read the whole post again and agreed wholeheartedly with every single word.
The main point comes with guideline #3: don’t spend impulsively. Of course budget for it first and then come back and buy it later after the “holy cow it’s a deal I better get out my wallet right now before it’s gone!” has worn off. Very wise.
Here I was ready to jump on a deal that I just READ about. *shakes head* Master teach student.
I’m glad you enjoyed my plot twist, Mrs. WW. Don’t get me wrong…by all means go and take advantage of the Subway deal. Just make sure you plan for it, and make sure it’s purposeful purchase that you will use that fits within your budget. Don’t make that decision at the cash register! Thanks for reading!
Wow, you’re tough. I totally would have bought the gift card. If anything, I’d buy the gift card, then use it that day!
I think it’s fantastic that you have guidelines that you’ve set for yourself, and you follow them!
That’s true, I could have even used it on that day’s purchase…but there would have been some left over. Would I have saved it for the next week’s Subway purchase, or would I have decided that since there was only a little left over I should go there for an extra lunch during the week? That’s exactly the kind of thing that could have happened – and then I’d be spending more on eating out than I normally do. The point is, I can’t possibly run through all these scenarios and come up with a meaningful plan while staring at the cashier. I need time to process each and every purchase. Again, we’re not talking about a lot of money here…but as I mentioned in an earlier comment, I need structure and consistency. The way I handle this situation is going to directly feed into how I handle future, more significant purchases. Thanks for commenting ,Emily!
While I commend you for sticking to your guns, I’m going to go against the grain here and say I would have bought the gift card. It sounds like you do a weekly budget, and I can definitely see some pros to that. My husband and I have a monthly budget, so if we purchased weekly subs I’d see the gift card in terms of paying for next week’s. It is a slippery slope, though, and I agree that you can fall into larger consumer traps that aren’t as innocent. To answer your question, it isn’t an either or. I do apply the same rules to all purchases, but something like that gift card promotion would have slipped through if the money was available in the monthly budget.
There’s a million different ways to budget, and if a monthly budget works better for you, then more power to you. For us, if we did a monthly budget, we’d probably spend all of our money by the 17th. 🙂 I need a bit more micromanagement in my budget – it helps keep me on track. Thanks for sharing, Natalie….it’s always nice to get a consenting opinion, and hear reasons why someone would operate differently!
I guess I see your point, but I would totally have gotten the GC if it were an expense I knew would happen each week.
For awhile, we were going to IHOP somewhat regularly (1-2 times a month) and if you bought a gift card, you’d get an extra $5. So I’d buy a GC before the bill came. Then I’d use the GC to pay for the meal we were having. The next time, we had a $5 head start.
But to each his own. I’m glad you know what works for you because, in the end, it’s a matter of sticking to what you’ve found is the best practice for your own needs.
Ah, but there’s a different in your situation and mine, Abigail….as time went on, you knew that they offered that deal, and purposefully and consciously made the decision to do it. You walked in the door knowing you would do it. In this case I was put on the spot at the cash register. Now, the next time I walk into that Subway (likely next Saturday), the story may be different….because my wife and I would have talked about it, and planned for it. I need the time to process things, and know for sure I’m making the right choice – with any purchase, big or small!
Hah! Just like everyone else I was on the fence w/ that decision even though everything you said was legit (and incredibly disciplined). Then got REAL happy with the result of the strategery afterwards 😉 Well played, good sir. Well played.
LOL, welcome to my roller coaster, J! I have to admit, I had a lot of fun writing this post. Glad you enjoyed it!
I think it would be a good idea to get the gift card, but your are totally right that buying it on impulse was not the right move. We are taking a small trip over Thanksgiving and our favorite out of town restaurant is doing a similar deal with gift card purchase and I think we’ll do it, but only because we’ve had time to consider. I doubt I’d do it on the spot. I hate real time upsells.
I agree, Kim – not only have you had time to consider, but you’ve had the ability to plan for the expense. Good to hear from you!
That whole idea of not sweating the small stuff does not apply when it comes to getting financially fit. You are right to be picky. I love that saying from your son’s coach. Your picky attention to detail will pay off. Keep on sweating the small stuff!
Sweat the small stuff and you won’t have to sweat the big stuff. That’s my theory anyway. 🙂
Makes sense to me. We analyze and discuss every single unexpected purchase–it’s just not worth the slippery slope of buying a coffee here and a muffin there and suddenly realizing you’ve blown $100 at coffee shops in a month! We do buy in bulk (we get the large peanut butter 🙂 ), but only for items we absolutely know we’ll use and that are shelf stable (rice, beans, quinoa, etc). I’m always wary of buying anything perishable in bulk.
I will buy bulk too, Mrs. Frugalwoods, but only after planning for it and saving up extra money for a “bulk buying” run to Costco. Gotta stay on track!
You have some great points here, Travis! I eat at Subway a lot, and have always found using a gift card a great way to set my money aside on payday. For me, it means I don’t spend my Subway money on something frivolous, which could happen if I had cash in my wallet. So the free sandwich is just a bonus on a gift card I was going to reload anyway. If you are concerned you might use the leftover funds for an additional lunch, you could always stick it in a drawer until Saturday. But you made the right choice for you. It’s always better to think it over before making a purchase.
Buying the gift card to make sure you don’t spend the money on something else….that’s an interesting idea, Sassy mamaw! I don’t have a problem with buying the gift card – and likely will do so – the next time we walk into Subway after we’ve talked about it and planned for the purchase. It was purely the impulsive nature of being put on the spot for the purchase that I will not deal with. Slow and steady, planned and purposeful – that’s how I’ll continue to be successful.
Your logic shows the opposite of financial discipline. Instead of discipline you are using costly mind games instead of getting the good deal.
I agree with your overarching post idea of playing like you practice but I have to agree with this statement about missing the forrest for the trees.
I see your point in trying to be super disciplined and staying with your main tenants, but nothing in life is static and sometimes you need to be flexible to get the best deals out there.
If you go to subway every week, then why not get the gift card and save $5 every week? If you wanted to not be rushed the first time you heard of it, that’s fine I guess, but once you knew this deal was out there, you are then overspending $5 on Subway every week. If you’re unable to keep a small amount of overage for the next time (or pool it with a new reload), then I guess you do need the strict control of not deviating from your budget.
The peanut butter thing is the same type of situation. Sure it knocks you over your weekly grocery bill one week, but that savings can easily be made up the next week or two by not having to buy peanut butter for a couple weeks.
I think moving to a monthly budget might be better for you since it would allow you to still stick to your strict guidelines, but also have room to take advantage of money saving opportunities as they come along.
As mentioned at the end of the post, Jake, next week (and the weeks after that for as long as the promotion holds) we’ll likely plan and budget for buying the gift card. But I refuse to make an impulsive decision to spend more than I had planned to.
As far as the peanut butter thing goes…..yes, I could buy a larger jar for a marginal savings. But there are two problems for me with doing so:
1.) If I have a ginormous jar of peanut butter, I tend to eat more peanut butter. Thus I end up buying more peanut butter and spending more on peanut butter (remove peanut butter and insert any product that you can buy in huge quantities). Now, if the savings was significant, I may change my mind – but the savings is really marginal. Believe me, I’ve done the analysis.
2.) Monthly budgets don’t work for me. I need a weekly checkpoint and weekly based structure to keep me on track with my finances. Without those guardrails in place, I’d probably find myself running out of money about 3/4ths of the way through the month.
But I think we’re getting a little off track with the specific examples. The point here really is, I do not make impulsive decisions, and I don’t spend more than I had planned. It may seem silly to some for such a small amount of money to not fork it out and save the $5.
To me, it seems silly to go into a state of overspending simply to save $5. I practice how I play – this is how I stay on track with my finances. It may not be the right answer for everyone. Some may be able to impulsively buy the gift card and juggle their budget on the fly and be OK with it. I cannot. Overspending breeds more overspending, and pretty soon I’m playing with credit cards. I’ll pass on traveling that road again.
Thanks for sharing your thoughts….great discussion!
This makes sense, I was getting lost in the specific examples. I agree the discipline is the key thing.
Discipline is a major key to success, Jake…….thanks again for the discussion!
I can appreciate the thought behind your comment, Jeff, but let me give you this scenario. Imagine our weekend spending is planned out liked this (oversimplified example):
1.) Subway $20
2.) Hair Color for Wife $75
3.) Movie with Family $50
4.) Present for b-day party daughter was invited to $20
Ok, so now I spend an extra $20 on a Subway gift card. Are you going to tell my wife she can’t get her hair colored, or my family that we aren’t going to a movie, or my daughter we can’t buy a present for her friend?
Now, let’s say that our budget has some amount of “slush” built in, and I decide to use it to buy the gift card. Then I get home, and find out some friends of ours invited us out for dinner and she planned to use the slush fund as well. Well, because I bought the gift card, now the slush amount is not large enough for dinner with friends.
When your spending plan is laid out very specifically and structured, spending any amount extra will cause problems. Also, impulsively spending money without communicating with my wife can also cause problems – as illustrated by my second example.
Now, in this case it’s $20. Not an earth shattering amount of money. But I’m a creature of habit and how I operate with small amounts of money will be how I operate with large amounts of money. I stay on the straight and narrow with my spending if I follow the same procedure every time. If I don’t…..well….I once was in $109,000 of credit card debt so you can see how that pans out for me.
I understand the “know thyself” argument, but please tell me you have now discussed the gift card and that you have made the decision to include it in your budget next time you visit Subway: a 25% saving is a 25% saving.
Absolutely, Myles – as mentioned at the end of the post, when I got home my wife and I talked about the deal going on at Subway and next week (and every week after that until the promotion is over) we’ll have a gift card accounted for in our budget (providing it fits).
You’ve just lost $5 though. In the UK as a higher rate tax payer that would be almost double in pre tax money.
You were going to buy the subways next saturday anyway so might as well take the free money.
But if the purchase of the gift card causes me to spend more than I would have THIS week, then I busted my budget – which I refuse to do – whether it’s $5 or $500. Next week it will be in our spending plan, after it’s been carefully considered, discussed, and planned for.
If that is what you need to do to stay on the “straight and narrow” and be successful in your own view, so be it. Even if it costs you 10-25% more when passing up unexpected bonuses or large-sized items.
Thanks Free To Pursue, although I think you’re missing the point just a little. I’m going back to take advantage of the savings, but only after I’ve thought about it, budgeted for it, and am on the same page with my wife. I challenge you to really be conscious about your impulsive purchases and see how many of them work out, and how many do not. I suspect that over time, the ones that turn out as not worth it will outweigh those that work out.
I really enjoyed the comments on this post. I understand the general premis and yes you have to practice. But like other I see the big picture.
I totally agree about how sometimes buying in bulk makes you eat more then you normally would. In that sense it can be more costly. Really its amazing it works for you. I agree with it our 1 and 3 but still on the fence about 2
I’ve really enjoyed the comments and the interaction as well, The Roamer. I’m surprised that you may be on the fence for #2…….I don’t see anything that warrants going over budget. Plus….what happens if you do not have any extra money to allow you to go over budget?? Thanks for sharing your thoughts!!