“Spaving” may sound like a way to fill in potholes, but it’s actually a term related to your personal finances. This recently-coined portmanteau combines the words “spending” and “saving,” and is based on the belief that you should spend money upfront in order to save more in the long run. There are those who’d argue the opposite, however, claiming that spaving only increases the risk of falling into debt. So, is spaving a panacea for your money woes, or is it just a pitfall that too many gullible people fall victim to? Here’s what you should know and whether you should try it out.
What Is Spaving?
Think of spaving as spending more upfront to lessen the total average cost of each item. For example, you may buy two boxes of cereal to get the third free. Benefits may appear immediately or possibly even years down the line, depending on the purchase. Some critics, however, claim there are no real benefits to be had, and that spaving is no more than a clever marketing tactic that helps the manufacturer far more than it does the consumer.
Common Ways to Spave
One of the most common spaving techniques is spending “X” amount of dollars in order to get free shipping. Let’s say you’re buying a $20 item and need to spend an extra $10 for free shipping — otherwise, shipping will cost you $8. After careful deliberation, you decide to throw in another $20 item, because $40 for two items sounds way better than $28 for just one. This is the perfect encapsulation of spaving; spending more than you were initially intending to in order to lower the cost of each average item.
Other ways to spave include buying an annual subscription to a streaming service rather than paying monthly, as that lowers the total cost per month. Another method is to pay substantially more money for a high-quality product. In this case, the expectation is that better products last longer, meaning you won’t have to deal with the hassle of replacing flimsier models more frequently.
Many people also unknowingly participate in spaving by taking advantage of retail sales. Retailers often use tactics like “buy one, get one” and “spend X dollars for a free gift,” as it attracts potential customers. Anyone who pulls the trigger on a sale like that is paying more money than they intended now rather than risk paying full price after the sale ends — this too is a form of spacing.
What Are the Drawbacks?
Critics deride spaving as little more than a marketing tactic that forces the consumer to pay more money than they had initially budgeted. Spending that extra $20 to earn free shipping may seem like a win to some, but nobody is forcing you to buy that second item and spend double the original plan. In essence, spaving boils down to a fear of missing out more than anything else, as there are far better alternatives for managing personal finances. Those who spave often are also at risk of developing excessive spending habits, and in extreme cases, spaving can even lead to crippling credit card debt.
Should You Do It?
A lot of financial advisors actually warn against spaving, as the perceived savings rarely add up to a level that makes these purchases worth it. Keep in mind that retailers aren’t trying to help you save money — they’re trying to earn profits.
There are certain circumstances where minor levels of spaving are acceptable, especially when it comes to the essentials. Let’s look at toilet paper — maybe one pack isn’t enough to earn free shipping. In this case, you know you’ll need more toilet paper down the line, so adding a second package for free shipping is within the realm of reason.
But when it comes to buying new clothing or a brand new kitchen appliance, don’t allow yourself to be lured in by clever advertising techniques. Just because you see a new shirt on sale for 50% doesn’t mean you need to pull the trigger, as nobody will be forcing you to pay full price for that same shirt after the sale ends. If you find yourself tempted by situations such as these, maybe sleep on it. If you end up pulling the trigger anyway, you should pay with cash if possible, as that eliminates the potential for credit card debt.
