Are social deal sites worth it?
Are these sites a good deal or just a way to trick you into spending money on something you don't need?
This post comes from Miranda Marquit at partner site Bargaineering.
"Social shopping" has become very popular. Through websites like LivingSocial and Groupon, it's possible to get discounts on products and services in your local area. Social deal websites send you tips about which deals are available, and then you can go spend money -- getting sometimes half off or more -- on different items.
One of the questions you have to ask yourself as you sign up for Living Social, Groupon or any other social deal site is this: Am I really saving money? Or are you just looking for a reason to spend it? Post continues after video.
When you are spending money, no matter what sort of "deal" you are getting, you are still, in fact, spending money. While you can find some good bargains with social deal sites, it's not as if you are putting that money into a high-yield savings account or investing for the future. You are spending it. And, quite probably, on something you don't need.
Before you get excited about getting $10 worth of frozen yogurt for $5, stop and ask yourself: Do you even want frozen yogurt? And how much frozen yogurt are you going to get anyway? Going to a sweet shop to get a couple of scoops of frozen yogurt can be expensive. That $10 gift card (that you paid only $5 for) might be enough for only two dishes. You might be able to go to the store and get a half-gallon of frozen yogurt for $5 -- and it would provide more than two people with a delicious dessert.
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An issue you need to address is whether or not you would be spending money on that particular product or service if a deal wasn't being offered. If you wouldn't go buy that new pair of shoes anyway, the truth is that your social deal is providing you with an excuse to spend money that perhaps you should be using for something else.
What if you will use your social deals?
Of course, social deals can be useful in some cases. My husband and I do a lot of shopping on Amazon.com. This includes buying our pasta and a few other grocery items in bulk. When a $20 Amazon promo balance was offered for $10, I signed up for a deal site just to get it. It saved us on the pasta order we made shortly thereafter.
However, I have not used a social deal since then. The spa deal was tempting, but I'm not planning to get a spa treatment anytime soon -- and even with the discount offered, the spa in question still costs more than the services I get at my local salon.
The key to making the most of social deals comes down, like so many things in personal finance, to honestly evaluating your needs and disciplining your spending. Like coupons for new products and services that you wouldn't even think about getting under normal circumstances, social deals might not be the best option for you. Be choosey about which deals you spend money on, and make sure that your spending is part of your overall financial plan.
What’s your opinion of these local deal sites? Good deal or just a way to trick you into spending money on something you don't need?
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