$400.00 kilt for FREE! Sound too good to be true?

[Detroitpete]

Ok--so at the risk of sounding like one of those infomercial spazzes--"You too can own a new $400.00 kilt for Free*"

I know times are really tough--trust me--I live in Detroit. With the economy as it is, it can be hard to justify the expense of a new kilt sometimes. Well, here's what I did last year (it's also worked for free* vacation spending money).

Simple saving trick: Do not pay correct change for any cash purchase--when possible use cash for as many odds/ends purchases as you can. Let's say a cup of coffee costs you $2.25. Pay for it with $3.00 and pocket the .75.

Your pockets will soon fill with change. Collect/sort/roll this change and save it for one year. Last year's total for me $427.00. Prior year's total: $401.00. It helps if you committ to not making a withdrawl from this stash. Saving by not 'feeling' it = free* $$ at the end of the year. Think about it--a dollar in change per day $365.00 per year.

This can be a good way to save for a 'tank', made-to-fit-kilt jacket etc. Especially when you think of the average wait-time to have these items produced.

I know it sounds simplistic, but its helped me.

[ThinBlueLine]

Detroitpete,

That is exactly what Bank of America started a year or two ago and I have been tempted to do it. I do not carry cash unless I absolutely have to so I would not be able to do the pocket change method.
It is an excellent idea though.

[Tobus]

Some banks offer this same type of thing when you use their debit card. I have not taken advantage of it since it would probably be a nightmare for keeping track of one's accounts. But the deal is that when you use the debit card for purchases, it automatically rounds up to the nearest dollar and sends the difference to your savings account. If, say, you spend $27.38 at a store, it charges your checking account $28.00. The merchant gets $27.38 and the remaining $0.62 goes into your savings account.

This would work very well for those of us who want to hate carrying cash/change. It's the same concept, although I don't know that all the banks offer it. The advantage here is that instead of loose change sitting in a jar all year, it's in a savings account accruing interest.

[Detroitpete]

Some banks offer this same type of thing when you use their debit card. I have not taken advantage of it since it would probably be a nightmare for keeping track of one's accounts. But the deal is that when you use the debit card for purchases, it automatically rounds up to the nearest dollar and sends the difference to your savings account. If, say, you spend $27.38 at a store, it charges your checking account $28.00. The merchant gets $27.38 and the remaining $0.62 goes into your savings account.

This would work very well for those of us who want to hate carrying cash/change. It's the same concept, although I don't know that all the banks offer it. The advantage here is that instead of loose change sitting in a jar all year, it's in a savings account accruing interest.

Good points---I'm a bit 'old school' so I don't mind a bit of 'pocket money'. Using the debit card makes sense for those who use that more often. The interest may be extremely minimal--but hey--its interest!

[sanddog28]

We have been doing the keep the change thing for about a year now it’s pretty simple and like you said it’s a great way to build your savings without even trying... I would have to build a little report in quicken to see exactly how much that is, but you would be surprised, in this no cash society America has become, how quickly the change adds up from your debit card purchases. But unlike Pete I hate change jingling in my pocket so if you were to follow me on my daily routine you would see stashes of coins in different places, one in the jeep, one in my desk at work and then the better half gets all the changes when we are out and about together LOL...

[Lyle1]

I used to save my pocket change, except quarters, which I needed for parking. It did add up, and I generally used it to buy something I wanted, but didn't really need. Where I used to live, most banks had free automated coin counters that spit out a receipt that you redeemed at the tellers window. Where I live now, I've only seen coin counters that charge a percentage of the coins you put in, and I'm too cheap to do that. So, now, I spend my change.

[Inchessi]

Yep, that's how I paid for a root canal. Ten years ago, a rebuilt transmission. I keep an old five-gallon glass bottle, and put my change in it at the end of the day. I now use a debit card frequently, so I do not have as much change as I used to.

[wildrover]

A warning regarding debit cards...

Transactions may not appear immediately. In fact, it may be several days before an item posts. Beware two things...the 30$ overdraft fee for a 5$ item, and lack of reimbursement for fraudulent charges.

Debit cards remain a great source of income for banks, as far as overdraft fees from college students. To this day, despite now having an overdraft line, a savings account and a buffer in checking, I reject the bank's overtures to use (or even have) a debit card. Besides...the rewards are better on a credit card, and if you use it as a debit card (ie pay it off in full every month), you're getting a reward with minimal risk to you, vs getting no reward at great risk to you with a debit card.

-Sean

[Tobus]

Well obviously any sort of card (whether debit or credit) needs to be used responsibly in order to avoid charges of any kind. Both have their downsides for people who can't seem to spend within their means or stay on top of their account balances.

You have a fair point on the rewards being better for credit cards, though, when paid in full each month. Some of them have a 1% or 2% "cash back" reward at the end of the year. That's a great deal. If you basically max out the card every month for regular spending (groceries, gas, etc.) and then pay it off when the bill comes, all of that gets applied to the "cash back" reward at the end of the year. That can go a long way toward the purchase of the kilt! And it's better than just a tricksy way of saving what you already had; it's a way of saving actual money on what you spend (i.e. a 1% discount on everything you buy).

[Detroitpete]

Not looking to stir anything up about credit vs. debit cards, banks, credit unions, interest, compounded interest etc. I simply stated that setting aside a few cents per day has had the effect of helping me save about $400.00 per year and that in lean times it can be a way to save for a more costly kilt or related item.

Respectfully,
Mark