The 5 Biggest Money Saving Myths You Need To Know

"A Penny Saved Is a Penny Earned."
- Benjamin Franklin

There are many ways to save money, but some could be costing you in more ways than one. Whether you are a voucher hoarder, loyalty points collector or a savvy online shopper, it pays to know the difference between a good deal and a clever scam.  Here we’ll take a look at 5 money saving myths and how to avoid the rip off deals. 

Myth #1.  Loyalty Cards Are The Best Way To Save

Loyalty cards were initially designed to reward customers and encourage them to shop with the same store. As technology has improved, the shopping habit data held on these cards has become a rich source of information. 

If you’ve got a stack of loyalty cards in your wallet or purse they probably influence where you shop. The big brand stores know that their customers want to build up points in order to get their hands on seasonal deals, discounts and other special offers. 

The problem is that we often use loyalty cards without considering the offers in other stores that do not offer a loyalty scheme. We automatically shop with the loyalty card store so that we don’t miss out on our points. And yet, the items on offer in another store might bring us more savings than those points are worth.

Myth #2.  The Bank Is The Best Place To Buy Holiday Currency

If you are going on holiday or an overseas business trip soon, take a moment to stop and think about currency exchange.  It surprises many people to learn that the bank is often one of the worst places (besides the airport and the hotel concierge) to change up your cash.  Before you travel, take some time to research the foreign exchange rates online.  Look at the live exchange rates and ignore the 0% commission fee deals as most exchange companies offer these nowadays.  By choosing an online foreign exchange company, you could save as much as 5% on your currency exchange deal.

Myth #3.  Bulk Buying Is Better

It’s true that big warehouse stores offering bulk buy deals can be a treasure trove for the clever shopper, but again, you do need to take care with some offers. For example, buying toilet paper is fine as this is a non-perishable item, but you might want to think again if you are bulk buying foods that do not have a long shelf life. What seems like a great deal in store might not seem so great when you find the items you bought at the back of a cupboard 6 months later and with an expired use by date.  Use the supermarkets for deals on perishable items and use the bulk buy stores for tinned groceries, laundry detergent and other long life items.

Myth #4.  The Best Deals Are Always Online

Think again before throwing away your morning newspaper or that magazine you’ve finished reading. Many companies still offer some great vouchers and discounts in these publications.  Just because there are some great offers online a lot of the time doesn’t mean you need to ignore the tangible vouchers you can cut out and keep.  Take a good look through magazines and newspapers and look out for discounts on products you would normally buy.  Then make a list of all the things you need (not the things you want) and tailor the coupons you have to that list.

Myth #5.  Debit Cards Are Always Better Than Credit Cards

Which card do you normally take out at the cash register?  It’s an age-old question. If you are responsible with your finances, there is no reason why you can’t take out the credit card - you’ll pay the balance off in full, right?  And if you are buying a big ticket item such as a TV or computer, some credit cards can actually offer protection against damage or theft.

Credit cards often come with rewards such as loyalty points, discounts and priority access into major events.  These are definitely worth a look when taking out a new credit card. You can also take advantage of long term 0% interest deals if you want to spread the cost of your purchases a little.

As with any credit facility, you just need to take care when using credit cards and be sure that what you spend can be paid back easily either in full or over a set period of time. 

About the author: Daniel Abrahams is a personal finance blogger, startup mentor at ABC Startups & Co-Founder of, an award winning foreign exchange comparison website.

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