Showing posts with label Coupons. Show all posts
Showing posts with label Coupons. Show all posts

Friday, June 10, 2011

The Case Against Coupons


There's nothing wrong with coupons. Families use them to advantage; and the larger the family, the larger the advantage.

But Brett Arends, in his article posted to Yahoo! Finance, "Doing the Math on Coupons," part of a continuing series on Financial Fitness, goes overboard in his appreciation.

Citing statistics provided in a press release from a company called Inmar as his source, Ardent says that on average each coupon saves its redeemer $1.44. Estimating that each coupon requires about a minute to find, clip and file, that would be a savings of $86.40 per hour of work. And since this savings is tax-free, figures Ardent, he feels justified in rounding up that number to arrive at a rounder wage rate of $100 per hour for coupon clipping. Not bad.

Now I have no bone to pick with the statistics, nor with Ardent's calculations. But Inmar is a company that provides promotional services, including coupon operations, to retailers and wholesalers. They have a vested interest in promoting coupons.

Let's look inside the computations to see if Ardent's numbers are helping Inmar along.

If we estimate that each coupon redeemed saves on average 10% of the purchase price (the average is actually about 7%) , that would mean a family would have to purchase $864 in groceries each week to redeem all that they clipped. That's $1.44 x 10 x 60 = $864. This seems a little high for all but the Duggers, doesn't it?

So it's more likely that coupon clipping once a month, or even less often, will suffice for most people. It's a tiny part time job, nothing like the net of $1,200 per year projected by Ardent.

If coupon clipping is something you enjoy doing for yourself or your family, that's great. I say do it. But for many of the rest of us, it's a tedious practice, one better employed as something of a last resort rather than a lifestyle choice.

Photo courtesy of Copy Cop.

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