Comments on: Saving Money versus Avoiding Spending

By: Tropper

Tropper — Mon, 30 Jun 2008 21:27:56 +0000

I am a recent subscriber to your site and I find your style of writing and insight some of the best in the blog world.

I must admit that one of my more common thoughts is just this – wealth is not predicated on how much you earn but on how much you don’t spend. This is clearly identified on one page called “the tally”.

Tropper
http://www.dontdiepoor.com

By: Clever Dude

Clever Dude — Wed, 25 Jun 2008 16:04:47 +0000

@lulugal, You’re still not truly saving anything. You’re avoiding spending money. I could say I avoiding spending 2 million dollars because I didn’t buy a Bugatti Veyron.

As for earning interest, you don’t earn interest on money that’s no longer in your account because you spent it to buy something.

The only way to truly save money when spending is if the difference between the original and actual price paid is sent directly to your savings account. But then you’re also losing money because you’re taking out money for the expense, regardless of what you’re putting in.

By: lulugal11

lulugal11 — Wed, 25 Jun 2008 15:55:42 +0000

Since you mentioned about putting the money in the bank then I CAN say that I save money when I buy something on sale because my money is in an interest bearing account. I have all my money in ING, most in the savings and some in the interest bearing checking account.

I use (cash back) credit cards to buy things and then send the money from the interest bearing account to pay for the purchase before any interest comes due.

I don’t have to ‘go put the money’ I ‘save’ from a reduced purchase in the bank because it is already in the bank earning interest. If the item is on sale then the difference is already in my savings account because then I would just transfer the smaller amount to go as a payment.

What do you say to that?

By: SingleGuyMoney

SingleGuyMoney — Wed, 25 Jun 2008 02:41:19 +0000

Great post as usual. I agree with spending avoidance but agree most people will just say I “saved” money instead of I spent less money.

By: Robert

Robert — Tue, 24 Jun 2008 14:16:39 +0000

When I see a sign saying that I can save 25%, I keep telling myself that if I do not buy it I will save 100%! I am terrible at saving so have decided that when I get the itch to spend extra money it will go right to the house payment. Because I get my “fix” by writing a big check I no longer have any debt and have even started writing checks to charities. It is a really good feeling!

By: budgets are sexy

budgets are sexy — Tue, 24 Jun 2008 13:00:56 +0000

Nice post Clever Dude – I was actually debating the EXACT thing in a previous post of mine…but, like you and the others, i still catch myself going with “saving money”….it’s just so much easier/quicker to get a point across

By: Rachel @ Master Your Card

Rachel @ Master Your Card — Tue, 24 Jun 2008 12:56:46 +0000

I can see your point about avoiding spending. If I don’t buy a pair of shoes but buy a pizza instead then I have saved nothing. However, if I put the money that I was going to spend on the shoes into the bank then it is saving. I was watching a TV programme last night where a woman was shown how to reduce her families food shopping bill by £700 a year and she said ‘that’s a years worth of shoes’ – wow, I spend about £50 on shoes a year if that!

By: Kacie

Kacie — Tue, 24 Jun 2008 12:29:02 +0000

I love it! I’ve actually been a nerd and said, “I avoided spending $x.xx” on a purchase.

When shopping with my little sister who gets excited about saving money at a sale, I’ll tell her she’ll save 100 percent by not buying it at all. She’s not so impressed.

Anyway, I linked back to this post because I think it’s important to remember you only save money when you actually put it in the bank!