Wednesday, August 05, 2009

Recession Deals Make It Harder to be Frugal

As the recession continues, restaurants, retailers, and the government is making it harder to be frugal. The cost of many items are coming down, sometimes to a level I find unbelievable. I've been tempted many times, and occasionally give in. Here are some examples of great prices that I've been seeing:

  • Meal and Happy Hour Deals. I recently wrote about Happy Hour Deals, where beer was cheaper than retail, and Restaurant Meal Deals , with $5 and $7 menu entrees. The discounts continue and are expanding.

    Pretty soon it will be cheaper to eat out than to cook at home :-)

  • Electronics. The main example is wide screen TVs. I saw a brand name 32" LCD HDTV for $437 at Best Buy. Costco had a brand name LCD HDTV for about $450. When I looked at wide screen TVs 5 years ago, the cost was about $2500 for a similar sized model. The same price reductions are happening for digital cameras. I haven't seen any super sales in computers yet, but maybe one is coming soon.

    A fully loaded laptop for under $300 might entice me to spend :-)

  • Cash for Clunkers. It's no surprise that paying someone $4,500 for a $1,000 car might encourage them to buy a new car. A friend of mine in turning in a perfectly good 1997 vehicle for a $4,500 credit towards a new car.

    My spouse's car does not qualify for the program. Although my truck qualifies, it is still worth more than $4,500 in a private sale and therefore, I would be losing money on the deal. Besides, we both planned to drive our vehicles at least 4 more years.

  • Clothing. Although I'm cutting way back on clothing purchases, I still can't help noticing the deep discount prices. Golf shirts on sale are going for under $10, less than what I paid at sales 20 years ago. My spouse just found some dress buys on the 65% off rack, and then received another 20% savings for opening a charge card.

    OK, I gave in and bought a specialized running top and shorts, but only for $7 each
  • While the offers are enticing, I have mainly resisted by sticking with the principle of buying only what we need. So still no wide screen TV or new car for us. However, with the cost of eating out continuing to decline, we may take advantage of dining deals more often.

    For more on The Practice of Personal Finance, check back every Wednesday for a new segment.

    This is not financial advice. Please consult a professional advisor.

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