7 Money-saving strategies that can cost you more

I'm in the middle of renovating a house, a project that started in January 2013 and will end — well, who knows when it will end? We have a lot of plans for this house.

Truly, the only reason we're able to afford this project is because we're doing the work ourselves. And the only reason that DIY is saving us money is because we have my dad on the job, who is a stonemason by trade but can do everything from laying tile to rewiring ceiling fixtures. Without him, we would either have had to hire a remodeling company, which we can't really afford, or try to do everything ourselves.

Not that we're completely inept, mind you. I'm pretty proud of my circular saw know-how and painting skills. But I know enough to know what I don't know and that DIY-rookie mistakes can end up costing you quite a bit in the long run. For instance, one of the big things we did was to shorten the wall between the kitchen and the living room. No, it wasn't load-bearing (everyone asks that), but can you imagine if it was and we tried to take it out?

Going DIY is one of many ways that people try to save money, but can end up paying more in the long run. Here are six more.

1. Buying a coupon to save money later.

A great example of this scenario is Groupon or LivingSocial. The deals hit your inbox, and one piques your interest. Sure, you've never been stand-up paddleboarding in your life, but you've thought about doing it. And it looks cool in the picture. And it's half-off your first lesson!

So you buy it, and then you forget about it. The expiration date comes and goes. This has happened to me a couple of times, so my new rule is to only buy Groupons for services that I'd use anyway or places that I already love. For instance, when I've bought Groupons to my favorite restaurant, I've always redeemed them. I don't think I could forget I owned that coupon even if I tried!

2. Buying more to get a discount.

A lot of online retailers will coax you into buying just a little bit more with their discount offers. For instance, if I just purchase $20 more, I can get 15 percent off or free shipping. I'd like to be immune to those offers, but the truth is, I hate paying for shipping and will do just about anything to avoid it, including scouring the ‘net for coupon codes and having items shipped to my local store for pickup. (I don't claim that this is rational behavior on my part.)

But the problem is that you can spend more money than you would've spent without the coupon. For instance, if I need $20 more in my cart to get free shipping, and shipping costs $8, then I'm paying $20 to save $8, which is $12 more than I would've paid without the coupon. In fact, I didn't save; I spent more.

Other times, though, it is a good deal. Last week I needed just $5 more to get free shipping on an order I was placing, and shipping was $6. So as long as I could find something I could really use for under $6, it was worthwhile to buy more.

3. Paying more to invest in quality.

More expensive doesn't always mean higher quality.

For instance, I take my chef's knife pretty seriously. I cook every day, and that thing is a workhorse. So it might make sense to buy a really nice one that will last for years and years. Maybe something pretty too, like this $200 beauty from Williams Sonoma.

But it turns out that one of the best knives out there costs only $30, and it outperformed the $100+ knives. From Cool Tools:

“A really great chef's knife is insanely sharp, yet retains its edge easily and feels well-balanced and welcoming in your hand. These days, a decent high-grade chef's knife can cost $100 to $200. Several cooking publications, including Cook's Illustrated, recently tested a bargain $30 chef's knife that rated just about as good as the $100-plus knives. It's the Victorinox Chef's Knife; the one we use.”

I actually bought that knife five years ago based off of Cook's Illustrated's recommendation, and I'm about to buy another because we need a second chef's knife in our kitchen.

Expensive isn't always better. Unless you do a bit of research, you might think you're paying more to invest in quality, when really, you're just paying more.

4. Paying less to save money now.

Sometimes it does make sense to pay more. If you're trying to save money by going with the cheapest item, that can cost more in the long run.

For instance, when I started painting my house, I needed a lot of supplies, like brushes, rollers, and trays. The paint salesperson at Home Depot suggested a kit that contained all of these items and was a “good value.” Unfortunately, the brush lost its shape after a couple of uses and the roller didn't roll so smoothly. It also made a loud squeaking noise. That might not be a big deal if I wasn't painting every single room and ceiling in my house. I ended up replacing all of those items with better-quality (and more expensive) models.

5. Buying extra to save over time.

Buying in bulk is a good way to save money, but only if you actually use it.

“A few months ago I went to Costco and bought a bunch of stuff in bulk to save money,” says Christina Collazo of Austin, Tex., “things like Annie's Crackers and muffins.” When she got home, she realized there wasn't enough pantry space to store everything. “So we stored all of it in the garage,” she says, “but because it was in the garage, we forgot about it and it expired.”

Costco has gotten me, too. The last time I was there, I bought a brick of cheese that went blue and moldy (and wasn't supposed to be blue and moldy). If you do want to buy in bulk, consider splitting bulk buys with someone else, especially for perishable goods that you may not consume before the expiration date.

6. Buying something that's too good of a deal to pass up.

Sales and clearance racks can be deceptive.

“My husband loves to shop the clearance racks,” says Collazo. “He'll even stock up on multiples if it's a really good deal, like the three pairs of running shoes he bought.” The problem was that by the time he wore out the first pair, he needed a different kind of shoe. “It was $120 down the drain,” she says.

I can relate. Finding a designer item at Old Navy prices used to be pretty exciting to me. Actually, it still is; but there was a time when big-enough “savings” would make me overlook things like it's not exactly my styleI have nothing else to wear with it, and it looks okay on me, from the right angle.

Even though I got a great discount, I wasn't saving money. Those items would hang in my closet, unworn and unloved. Eventually, I ruthlessly cleaned out my closet and got rid of those sad reminders of how much I'd spent on those great “deals.”

It's easy to confuse a discount with saving money. Obviously, I've done it many times! But I'd like to hear from you. When have you spent more money because you were trying to save? What lessons did you learn?

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FrugalSage
FrugalSage
6 years ago

Starting a new habit and emotionally buying into it in a big way at an early stage. For example, deciding that you are going to do a lot of hiking and buying all of the latest hiking gear from a shop before your first trip. It’s fine though “because it will save on gym fees”. Then they end up only using it once. You should always start out slow on a new hobby and see if it’s something you will get into. Another one which is slightly different is just not utilizing your time efficiently. I have seen people spend… Read more »

Beth
Beth
6 years ago
Reply to  FrugalSage

Yes! My mom used to say “it’s not worth running all over town to save $1 on x”. (Or some variation thereof). For some people, shopping for bargains is a form of entertainment – but not for her!

Miss Growing Green
Miss Growing Green
6 years ago
Reply to  FrugalSage

Agreed. I’ve definitely done the “I’m going to invest in X because I want to commit to doing it on a regular basis”. When I moved to Colorado I invested in a lot of ski and snowboarding gear because I wanted to start skiing and snowboarding regularly. But, what I probably should have done is just go a few times first to make sure it was something I really enjoyed.
I often felt obligated to go simply because I had invested in so much gear. Silly!

SLCCOM
SLCCOM
6 years ago

Really silly! What do lift tickets, gas and auto wear and tear, food, etc. add to the cost?

Mel @ brokeGIRLrich
Mel @ brokeGIRLrich
6 years ago
Reply to  FrugalSage

You are so right! I’ve reached the point where I know a new hobby is cursed if I spend a bunch of money outright on it. The last two hobbies I’ve taken up and actually stuck with went entirely against my old habits. When I decided to start swimming again, it was spurred because I found some old goggles in our attic. I unearthed an old bathing suit and swam until I got out of the pool one day and realized the suit was so old and worn it had become borderline see-though :o/ I’d been swimming every day for… Read more »

Beth
Beth
6 years ago

Great tips above — especially about buying quality items but doing your research first. I have a $20 pot that out performs pots in my supposedly good quality set (I bought on sale with a big discount, but still!) My gaff is extended warranties. I had one on my first laptop and it more than paid for itself when a $700 part died right before the warranty was up. (I was student and wouldn’t have been able to replace the computer had something happened to it so it made sense to have “insurance”) I then thought it would be a… Read more »

FI Pilgrim
FI Pilgrim
6 years ago

Flipping houses when you’re inexperienced. Those realtor fees can totally kill your profits, or worse!

robert
robert
6 years ago

Underwear and undershirts are much cheaper in big bulk packs.

Carla
Carla
6 years ago
Reply to  robert

…and they fall apart faster.

Adam Hagerman
Adam Hagerman
6 years ago

One of the other issues with online coupon sites like Groupon is that it’s usually for a $ off a meal when you are looking at restaurants. Most people just focus on the $ off and do not check out the menu before purchasing. The menu then ends up being really expensive and you spend a ton on the food just to use the coupon you bought. You just end up spending as much as if you would have went to Applebee’s.

Tina
Tina
6 years ago
Reply to  Adam Hagerman

I agree. We learned the hard way that the restaurant was extremely expensive and wouldn’t have eaten there otherwise. Plus the food was mediocre.

Sam
Sam
6 years ago

I’m a late adopter by habit. So when I finally got around to signing up for GroupOn and Living Social I figured out how to use the site based on all the mistakes my friends made. First, I buy with purpose. I buy coupons for places that I already like and already patronize. Second, then I use them, I calendar the expiration dates in my real calendar. I also only normally have one, maybe two, coupons at any time. I will buy coupons for new places or for places I want to try but again I only buy for close… Read more »

Jennifer B
Jennifer B
6 years ago

The one I see people doing is driving all over town to get to a gas station with the cheapest gasoline.

It doesn’t make sense. My car holds 15 gallons of gas. Spending an additional 10 cents a gallon will cost me…. $1.50.

So will I go a few blocks to get to the station I prefer with lower prices? Yes. But I won’t drive across town to chase a better gasoline price.

Matt at Your Living Body
Matt at Your Living Body
6 years ago
Reply to  Jennifer B

It’s more than just about the money. It’s about sticking it to the man!

Where I live the gas is about .30 more than the one about a mile and a half away. Totally worth it lol.

BIGSeth
BIGSeth
6 years ago

What’s your time worth?

Alan | Life's Too Good
Alan | Life's Too Good
6 years ago

Yep, good tips. It’s amazing how many people go for bargains like “3 for the price of 2” when they only needed one in the first place!!

Everybody loves a bargain – just make sure it really is one (i.e. is something you really need or at least would definitely use).

Jeff
Jeff
6 years ago

Yes, “buy two get another free” is worth it when it’s something you know you will need more of later, especially if the deal is for something non-perishable. Whenever getting close to time to restock on health and beauty stuff I look for such deals so I can stretch the budget further.

Shobir
Shobir
6 years ago

Groupon and other social living websites that send me vouchers and coupons did catch me out. I remember buying tickets to a luxury SPA which I completely forgot about. I’ve now removed myself from all the mailing lists because these offers can be so tempting. Great post, thanks for sharing.

Jane
Jane
6 years ago

At the moment, I’m struggling with a large scale purchase in similar terms that April sets up in this article. Will it save us money in the long run? Time will tell. We just committed to put solar panels on our roof, which essentially means we are pre-paying for our electricity for the next eight or so years. It kind of felt like buying in bulk, and we won’t know if we actually end up saving for quite a while. Lots of purchases are a gamble. You just have to decide if it is worth the calculated risk or not.… Read more »

Joseph
Joseph
6 years ago

Not saying it’s never worth it, but one of my pet peeves is when people drive way out of their way to save a couple cents per gallon on gas. There’s a line where you use enough gas getting there that it negates your “savings”.

El Nerdo
El Nerdo
6 years ago

I’d like to add “automating your finances.”

If out of sight is out of mind, I choose to be mindful and pay what I can “by hand.” It actually helps to see exactly what’s going out, and trying to reverse overcharges or other nonsense can be a world of hurt.

Then there’s the problem that the more places you store your data, the greater your chance to have it stolen.

Beth
Beth
6 years ago
Reply to  El Nerdo

I agree and disagree. I think “set it and forget it” is a bad idea — we need to pay attention. I have some things automated and don’t have a problem because I keep close tabs on all my bills.

I don’t think auto pay is any riskier than any other transaction. I’m more worried about a retailer getting hacked or a government official losing their laptop. (It’s happened a few times in Canada!)

lmoot
lmoot
6 years ago

programmable thermostats

tasia
tasia
6 years ago

My partner is a dog groomer and has to keep her tools sharpened. She always waits until every tool needs to be sharpened to have it done. This last time as her tools got more dull she decided to buy her own sharpening kit that was “a great deal” . After 5 hours ( a professional takes about 2) she thought she was done. She trys to use the blades and none will cut at all. Then she calls a professional to help who charges more since she is ” in a bind.” After the 200 bill she still can… Read more »

LG
LG
6 years ago

On the Groupon issue-

I’m SO DONE with mediocre massages purchased on Groupon/Living Social! I’d rather save up my money to splurge on a good one where I know they have great services/aren’t shady/have a nice spa atmosphere, etc.

Mrs PoP
Mrs PoP
6 years ago

How about buying gifts too far in advance and then forgetting about them! My mom would do this all the time when we were kids… months after Christmas she’d come across some toy she bought for us well hidden in the closet. We’d then get it as a “just because”.

Anne
Anne
6 years ago
Reply to  Mrs PoP

I have to comment on this (or perhaps I’m your mom). I did this every year and it got to be a hilarious family tradition, although unintentional.

The boys had a contest to see who got the “latest” Christmas present. I think the winner was the kid who got a framed Raiders poster several years late as it was hiding in the back of my closet.

Marabeth Duncan
Marabeth Duncan
6 years ago

I use Dealsaver (like Groupon in my area), and I LOVE it. My husband and I love to go out to eat, and we afford to go more often because of Dealsaver. I buy at least 3, sometimes 5, a month. We keep them in the car glove compartment and when it’s time to decide where to go, we pull them out and have to pick an option from the stack. I have lost money by trying to save when I took my real leather boots to get resoled. It was $40 to do so, but they were not meant… Read more »

Carla
Carla
6 years ago

Groupons today are almost never worth it. In the early days they were and I did purchase coupons for good local restaurants and quality spas, but since the vendors realized they were getting screwed in the long-run, many businesses pulled out. Now you have a lot of mediocre vendors selling coupons for overpriced goods and services.

Starbucks did have a $10 for $5 last week (good for traveling) but those deals few and far between.

Money Saving
Money Saving
6 years ago

I’m glad you added Groupon/Living Social to the list. I absolutely hate these companies and avoid them like the plague.

They entice you to buy products and services you would never even consider by making you think everyone is doing it, making it scarce, and imposing a time constraint. It’s pure evil I tell you!

Elissa @ 20s Finances
Elissa @ 20s Finances
6 years ago

My mother is the worst offender I can think of for the “buying deals too good to pass up” thing. It’s awful seeing her return from the grocery store – so many 2 for 1’s of things we don’t even use!

Short arms long pockets
Short arms long pockets
6 years ago

I lost money by not paying attention to the dates on my Vision insurance policy. I was concentrating on using up my FSA dollars and forgot to check the date that I was eligible for a new pair of glasses that would be covered by insurance. I missed the insurance coverage by 3 days. If I had waited I would still have been able to use the FSA money, but the insurance would have covered a whole lot more.
Lesson learned: Know what you are covered for and when.

Ivy
Ivy
6 years ago

Speaking of FSA, I have a whopper from a few years ago. We knew we were going to do an IVF next year and since we had reached the lifetime maximum for fertility treatments and a cycle costs $16-17K I put $20K for FSA, my company allows that. Well, the year started and just as we were about to start the cycle I got pregnant naturally (the story is a bit more complicated but that was the net effect. And no, nobody could have predicted it given our medical history). Now, just try making $20K in medical expenses in a… Read more »

Mrs PoP
Mrs PoP
6 years ago
Reply to  Ivy

You must have booked the ultra-luxury suite at the hospital for when you gave birth! =)

Micro
Micro
6 years ago

I invested in a vacuum sealer just for the purpose of the bulk at Costco. This lets me stock up on things but I can divide them up into more manageable portions and simply freeze the rest. I don’t have to worry as much about things going bad.

J.R. @ StraightFinancial.com
J.R. @ StraightFinancial.com
6 years ago

When Groupon first became popular I know I was guilty of “buying a coupon to save money later”. Later on when I finally remembered I had purchased the coupon, it had expired. I learned my lesson. NEVER AGAIN!

Joseph
Joseph
6 years ago

The funny thing about Groupon that I feel a lot of people don’t know is that the money you spent on the deal doesn’t expire… just the special deal. So, for instance, if you buy a $10 for $5 deal to Starbucks and the deal expires you can still go use that “coupon” as $5 at Starbucks.

Carla
Carla
6 years ago
Reply to  Joseph

I’m surprised that people don’t know this given that they do announce it on their website, when you purchase a coupon and even if you let it expire.

Betsy22
Betsy22
6 years ago
Reply to  Joseph

Even though that’s groupon’s policy, I still had problems redeeming an expired Groupon voucher for even the paid value. It was a small local restaurant and they just didn’t accept the expired voucher. I guess that I could have pursued it through groupon or other channels, but it just wasn’t worth the hassle.

Josh
Josh
6 years ago

California banned the “expiration” of stuff like groupons. If it expires, it just loses its extra value. So if you bought it for $20, it reverts to being worth that, and never expires.

Kasia
Kasia
6 years ago

Number 5 and 6 are so true. Stocking up or buying something just because it’s on special is not saving money. Only buying what you need and when you need it will save you money. Note to self: start doing this more often! haha
I completely agree that higher price doesn’t mean higher quality, especially not these days where every product seems to be made in the same place regardless of the price tag.

Hannah Bouchoucha
Hannah Bouchoucha
6 years ago

That’s a great list! I’m probably guilty of every single one of those.. Especially the Groupon issue and spending more to get a deal – for example buying one gets you the second one half off, and I don’t realize that I’ve bought something I really don’t need until I have left the store!

That’s why now I try to only do instant coupons and codes and cash back, because then you don’t spend more money and you use it instantly so you don’t forget about it.

retirmentbuff
retirmentbuff
6 years ago

I loved your kitchen knife example. I bought it as a gift for my husband. He loves it too!

I’ve fallen into the groupon trap they expire before they are used. blah. I was taking my honda to juffy lube after the warenty was expired but they put the wrong filter on and nearly cost me thousands so now I use the dealership.

Tahnya Kristina
Tahnya Kristina
6 years ago

I used to do all of these things, especially the spend more to get a discount. Sales were my financial weakness. But since becoming debt free I have completely changed my money mentality. I look for discounts on things that I need to buy (such as haircuts on Groupon) not buy things just because they have a discount.

Crystal John
Crystal John
4 years ago

Coupons are really cool. Since I stared doing with coupons I have save beyond the imaginations. Thanks to retailmenot, LavishCoupon, silkdeals for these savings. Grate strategies, I must say !

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