The rise of online shopping
Amazon.com went live in 1995. The site quickly became the largest online retailer in the world. Bookstores have been decimated by shopping online and ebooks. The war has largely been fought, and the brick and mortar stores are disappearing. Aside from making it difficult to find a book at your local retailer, shopping online can be a tremendous convenience.
The gateway to online shopping starts with your 16-digit credit card (debit, gift card, etc.). After every order, you’ll be required to enter your shipping and billing addresses, contact information, and your payment method. Credit cards are wonderful tools for these online shops, and they’re safer due to complete fraud protection.
There’s just one problem: convenience can wreak havoc on a healthy budget.
Credit card numbers are easy to memorize
They do it. This is aided by websites that save your billing information for later purchases. For instance, Amazon.com — by default — tries to save your credit card details. Then, when you go shopping again, you’ll just be able to select the card. In seconds, you can have your new products. It’s so easy on Amazon.com that they even have a one-click buy button.
You do it. I’ve been shopping online for years, and noticed only quite recently that I memorized a couple of my 16-digit credit card numbers. How? Excessive purchases over the years, but also a training process. Unless you’ve lost your card, had it stolen, and/or suspect fraud, your number generally doesn’t change. If you’ve had a credit card for years, you have more exposure to the same digits. Memorization is made easy and purposeful.
Delay the purchase, reduce the urge
Research shows (and trust me, Amazon is listening to it) that aiding consumers in making impulse buys equals more money. If I can reduce the time and effort to make you spend, you’ll come back and spend more over time and in single sittings. Pretty awesome if you’re a Fortune 500 company with a near-$400 stock price! If you’re an average Joe or frugal Jane, this can mean trouble. Here’s a two-step solution to this problem:
“Lose” your credit card. The first step is to call the credit card company and tell them you can’t find your credit card — you’re worried you lost it. Once you do this, they will issue you a credit card with new numbers. This will restart the number learning process and delay new purchases online, as you’ll be able to think more critically. After all, critical thinking takes time — you owe it to yourself. Note: you won’t be able to use the card anymore — you’ll need a backup card for a week.
Delete your details. If you’re an Amazon.com shopper, delete your billing details off the website. You’ll have to add them again at a future purchase, but having the inconvenience may actually mean less money spent. Give yourself time to think, “Do I really need this?”
Memorizing a credit card number — as the retailer or consumer — is trouble for a delicate budget. This simple psychological trick of slowing your purchase down can significantly reduce your spending and keep you on track for a frugal future.
I’ve never got into the on-line buying habit, although I have done it. I think it could be a generation thing because I see my kids doing it all the time. Come to think of it, I don’t even like going to shopping malls anymore… so on the needless spending front, I’m all good. For me the focus is on food, gas, utilities and booze (ok that could be needless… you got me there) … not that I can do much about those (I know, except for the booze)
Thanks for cheering me up knowing that I am saving by not shopping on line. š
Interesting Sam. The one thing that I can’t do is memorize my credit card numbers. I didn’t even do it when I used them to rack up my massive debt. I remember many other numbers, but credit cards are not one of them.
Nice tips. Online shopping can really be a trap to people who are trying hard to live frugally. I just wonder though if credit card companies don’t charge you for card replacements.
I’ll be honest. I HATE pulling out my credit card for the number (which is naturally why this tactic is so effective) – but for me, I don’t fall into impulse purchase traps, so I can opt for the convenience. It’s almost like having a credit card with reward points. You can only have it if you are responsible with it. I feel as though I can save my CC info on Amazon because I only make well thought out purchases. In 2014 so far, I have spent a total of $6.99 on Amazon!
The only time I don’t buy something I “need” online is when it’s a gift for someone else. Though I’m considering buying a book with the new credit I got from that recent publishing settlement.
Oh yeah! That was a total surprise. I got about $7 for that one. š
You better use that credit for a book! Haha. Otherwise, you should send it my way. They expire eventually, as well. Watch out for that!
Online shopping sucks! They make it so gosh darn easy to spend, especially in Amazon where you can literally find everything you need and then some. My trick to not spend money online is I never will buy everything in my cart that same day. I sit on it. I go back to it and edit over a week or so. Impulse buying is dangerous but I realized that if I actually just wait to make the purchase later, more often than not, I end up just not buying it.
As much as I’d prefer online shopping to traditional shopping, I haven’t made much of a habit of it. It might be the fact that online shopping here in Canada is much less convenient and cost effective than it is in the States! We have Amazon Canada but it’s nothing compared to the US version. Shipping costs are insane for Ebay and the US version of Amazon to be shipped to Canada, even if the products are available internationally (which isn’t usually the case).
Convenience is definitely something that makes me spend more, though, so I think your tip is valid. If my card information is saved in the system, I’m probably more likely to press “submit” in my shopping cart!
This is a great trick to reduce spending. A lot of times if I even have to stand up out of my seat to get my card I just won’t bother. Humans are funny creatures. And Amazon knows exactly how we work.
In my opinion, i you need to “lose” your credit card to keep yourself from buying stuff online, you’ve got a serious problem and shouldn’t have a credit card to start with.
What’s wrong with some plain & simple common sense and self-restraint from time to time ?
Just leave your shopping basket, close the session and think about your potential purchase for a few moments. Even better: sleep on it.
Ask yourself these questions:
-do I really need this item for a legitimate reason ? or did I create a reason ?
-do I really need it now or can it wait ?
-are there (cheaper, other) alternatives ?
-how often will I use the item(s) ?
I find that after having slept on these questions, I more often than not just delete my basket and carry on with other things.
Lately for my Amazon “wants” I will just leave the items in my shopping cart for a few days. This way I have time to analyze if it makes financial sense for me to purchase. It is amazing how many things I don’t end up buying!