On Black Friday, I mentally high-fived myself when I used cash-back rewards money to buy several pieces of clothing I needed for my winter wardrobe. I thought to myself, “I just saved $100.” But really, I didn’t. While $100 didn’t leave my checking account, it didn’t go into my savings account, either.
We all routinely brag about a way we saved money. You’ll hear people wax poetic about cutting the cord and no longer paying for cable, or couponing to save a few bucks on groceries, or using credit card bonuses to pay for a vacation. But here’s the big question: are they really saving?
While we claim to be saving, is that extra $40 a month from cutting cable actually going into savings or just being reallocated to justify eating out or going to the movies?
A Penny Really Saved
Abigail Perry, founder of I Pick Up Pennies, realized her mistaken assumption about saving and decided to make a simple change.