Wall Street Journal Says “Extreme Couponing” – We Say Smart Economics and Savvy Personal Finance

Wall Street JournalYesterday, members from this site and other online couponing communities were featured in a front-page article of the Wall Street Journal entitled “Hard Times Turns Coupon Clipping into the Newest Extreme Sport”.

Instantly, people on Twitter were tweeting about it, and bloggers were likening people with stockpiles to hoarders.  Sadly, the article and the subsequent video that went with it, went for the “extreme” shock value of what stockpiling is all about.  The video commentary that went with the story was quite offensive – calling extreme couponers “crazy and insane”. It wasn’t what I’d expected when I was interviewed for the story.  My personal take on stockpiling is about the economic value of having a pantry.  That wasn’t evident anywhere in the story.

So, I’m going to give you the other side of the story.  The one the Wall Street Journal missed out on, and the side that makes the point that stockpiling, extreme couponing, whatever you’d like to call it, is purely about economics.

Stockpile theory is a very simple premise…

First, make a list of the most important food items in your diet. Also make a list of non-perishable household items your family uses on a regular basis.  If you have pets, include items for their care as well.

Then look at the average weekly consumption of any given item.  How much cereal do you eat in a week?  How many times do you cook pasta, feed the dog, wash your hair, brush your teeth?

When you find the average weekly consumption for your list of items, multiply that amount by 52 weeks in a year.  That’s the amount of “inventory” your family should reasonably consume during the entire year. However, one should also consider the value of non-perishable items.  If the sale price is right, or the item is free, then it’s not unreasonable to stock up on more than a year’s supply of light bulbs, toilet paper, toothbrushes, or shampoo.

Then, look at the shelf life of a given item.  In the Wall Street Journal article, I was quoted as buying “50 jars of peanut butter” and some people commenting thought that was excessive.  However, peanut butter has an 18-month shelf life and I use one jar per week.  So a 50-jar purchase made all in the same week at the lowest seasonal price is not unreasonable. In fact, the savings on that one item was over $150 for the course of the entire year.  If my family’s consumption is one jar per week, rather than making 50 trips to the store to pay full price each visit, one trip to the store to buy what I need at rock bottom prices is much more economical.

Some items don’t have that kind of shelf life, and subsequently, they run on shorter cycles.  Steep discounts on oatmeal and granola bars happen twice a year, and the sales tie in quite nicely with the 6-month shelf lives on those products.  So understanding the simple principle of “First In, First Out” is helpful for maintaining a stockpile of perishable goods.

Foods that are still within the expiration but have a chance of not being consumed should get donated to a local agency that accepts food donations. The great thing is, you can do so and get a charitable tax deduction for the donation.  For some, the value of the tax deduction of the donated goods offsets the cash outlay for the goods purchased for personal consumption, making the cost of grocery shopping either a break even proposition, or a profitable experience.

In the peanut butter example, that $150 I saved can now go towards stockpiling some other items for future use. Stockpiling isn’t about over-consumption – we consume our pantry items at a regular rate of consumption. My family rarely consumes more than one jar of peanut butter a week.  Just because it’s there doesn’t mean my children are gorging themselves on peanut butter.

I liken the savings in my household to the retained earnings of a business. Stockpile savings is like profit after business activities. It’s net after-tax dollars that can be either taken as a draw for fun things (like family vacations and piano lessons for the kiddos) or it can be reinvested into the personal finances of your family – ie, fully funding a 401K, paying down debt, buying a first home, going back to school – things that create economic value and build wealth for your family.

A good business manager is rewarded for cutting costs, managing inventories effectively, and creating wealth for the company.  We don’t call him crazy or insane.  Instead, he’s given more stock options, raises, and promotions.  Those of us who fall into the “extreme couponing” category are doing precisely the same thing except the wealth is being created for our personal financial gain.  If I put $10,000 into a 401K account, I’d be doing better than most Americans.  But if I could put $10,000 in the 401K, and then shaved $10,000 off of my planned purchasing, the dollars I saved couponing could actually do more for me than the money I’ve saved in the 401K because it’s cash dollars I can spend right now and use for other investment vehicles.

Are there people out there that are clinical hoarders?  Absolutely!  We’ve seen from shows like A&E’s “Hoarders” that an estimated three million Americans suffer from hoarding.  Interestingly though, you never see people in those shows clipping coupons as a means of feeding the obsession with accumulation as it relates to the disease.

Could there be people who coupon who do have a hoarding illness?  I’m sure there are.  But the people you find at sites like this, using social media tools to save thousands of dollars a year – the obsession isn’t in the accumulation of stuff, rather, it’s in the security of having finances and an inventory of goods that will get them through hard times. For some, the economic gain of stockpiling is what’s kept them ahead of the recession.

Interestingly, Hotcouponworld has a disproportionate amount of members and site visitors that are in high-income earning household compared to other sites on the net.  The bulk of our members are either working towards or have achieved some level of post-secondary education.  That tells me that many “extreme couponers” do so because they have a grasp on what it takes to achieve wealth, and for those who have amassed some level of security, why pay full price and deplete those resources faster than necessary?

Once upon a time in American history, having a supply of food on hand was considered to be a sign of wealth, security, and prosperity.  Today, one-tenth of the country is on foodstamps and food insecurity is a sign of the times. People who have used modern day marketing tactics to their advantage to accumulate a stockpile are doing better than the average American.  It makes you wonder if our ancestors didn’t have the right of it that the material things in life that mattered most were the ones that covered basic needs.

As I spent some of yesterday responding to commentary on different blogs posts about the article, one thing struck me.  One commentator posted that he “prayed the economy would get back to “normal” because of all the extreme couponing happening out there”.  My comment back was that for those of us who have been doing this, we’ve been at it long before the economy tanked.  For many of our members, having a stockpile is what has kept them in their homes and ahead of their friends and neighbors as they lost jobs and had houses foreclosed upon.  But, believe me, we too wish the economy would get back to normal.  The there might just be a little more elbow room at the grocery store!

A more interesting article from the Wall Street Journal would have been one that portrayed the economic security of having a 3-month, 6-month, or even 12-month pantry on hand, how it’s keeping people secure, how it’s putting food into the community food system, and how smart shoppers are using it as a low-finance, wealth creation tactic to stay ahead of the recession.

13 thoughts on “Wall Street Journal Says “Extreme Couponing” – We Say Smart Economics and Savvy Personal Finance

  1. Well said Julie! Our forefathers/mothers stockpiled food to get them through lean times or to pull them through winter. Great grandma had a garden and canned food to put it by and a food cellar to store root vegetables. Great grandpa hunted and they smoked or salted meat to last through the winter. In today’s time though many of us no longer hunt and garden (well I garden) so instead we look to build that stockpile by playing the coupon game and find ways to get the items our family needs and wants at the lowest price point. So instead of canning tomatoes from the garden (I have yet to learn to grow tomatoes in Wyoming!) I purchase canned tomatoes for $0.20 a can and have enough on hand for a year to use in homemade spaghetti sauce or chili or what have you. Instead of smoking a side of bacon or canning some deer meat I look for deals on chicken and beef and store it in my freezer. I don’t stockpile for emergency purposes but I can tell you that if an emergency comes up it sure is nice knowing that you can feed your family from your stockpile!

  2. Amen sister. Coming from the perspective of a person whose family has suffered decrease cash flow due top my DH’s hours being cut I completely understand what you are saying. I have friends and family who are struggling too, but yet have no desire to even try to cut costs by couponing, they may think I’m crazy, oh well I’m not stressing about where my son’s diapers are going to come from, what we will eat or if we have shampoo-we have it and it all is taken care of.

    On the hoarding aspect, my grandmother is a true hoarder and while much of it is usable goods, most is just stuff. Knick-knacks, stuffed animals, clothes from the thrift store. I’ve gotten a few cross eyed looks with my 10 bottles of Purex the other day, but YK, everyone does laundry and if I have the space to have 10 bottles for the price of 5 good for me.

    I’m sorry they made it out like we’re crazy, but of course doesn’t the WSJ want people to spend more money, I would think yes, this economy is surely effecting their bottom line too.

  3. Very well stated. While I have the economic means to get most of what I “want”, I “choose” to “spend” the free $$ that comes out of the paper I pay for each week. The way I see it, it only makes cents…oops, sense. Why would any smart person pay more, sometimes 90%-100% more, than we do for the same items? Does it take more planning? Yep. But, I now look at shopping the way a treasure hunter looks at it, it is the thrill of getting that bargain!! I am also suppling much to friend, family and those in need. Go ahead, call me a crazy couponer…Crazy like a Fox!!

  4. Nice response!

    I don’t see how stocking peanut butter, cereal, pasta, or whatever at 1/2 (or less) the price is any different than our parents or grandparents butchering a cow or pig and freezing the meat. Or canning vegetables and fruit. The only difference is that some of the animals, fruit and vegetables were home grown. They put away food for the lean winter their way, we do it our way.

  5. Very nicely said. I havent even read the Wall Street Journal Article yet and after reading yours, I do not know if I will!!!I wish I had the extra time to be considered the Crazy Couponer!!!! I am one of those members that is on the higher scale of income but I work a lot of hours for that income and my 4 teenage boys just keep eating and growing which is why I started couponing to begin with!!! It is the SMART WAY to live just as you said a business should be ran!!! Thanks so much for your article!!!

  6. Great article Julie! I really have to go back to basics and look at this the way you laid out. I don’t hoard food or household items and I don’t think I’m extreme in my couponing. Just smart! But I could be smarter! I love the inventory theory, never really thought about it quite that way before. That idiot on the video was so demeaning and the reporter from the WSJ looked about 12 – what does he know?

  7. Oh well, that leaves more things for us at the store :) If people think that we are crazy, the won’t want to do this.

    If someone truly wants to learn how to save, they will join this site and get educated. I was a average couponer until I did a search online one day and discovered this site. People who want to save seek it out—we don’t need to do news articles—they will come on their own.

  8. I’ve only been “extreme couponing”, or “smart couponing”, or whatever you wish to call it for a few months now and have already realized a great savings. I’ll admit that it’s more hobby than necessity in my case (some people watch American Idol, I surf & snip), but it is nice to be able to put that extra money toward other things for my family. I’m thankful for sites like this one that make it easy to live better with less money.

    I’m learning as I go, and sometimes I get overzealous. One thing I have learned is that there are some things I really shouldn’t stockpile. I don’t shave more often just because I have more razors, but I do find that I snack more if the snacks are here ;)

    Another thing I have learned is the value of a stockpile in an emergency. Just last night, a relative’s house was largely destroyed by a fire. Fortunately no one was home and no one was hurt, but he lost most of his posessions. I know it was a small gesture, but because of the stockpile, we were able to quickly gather a care package to get him through a few days of displacement more comfortably. I wouldn’t have been able to do this a few months ago.

    And yes, I’m sure there are people who are obsessive and people who hoard, but they don’t represent the majority of people whom I have met or chatted with that do this. Like interviewing the tornado victim that lost his trailer, WSJ is highlighting the most sensational aspect of a story for marketing purposes. And speaking of marketing, why not just admit that part of the point of “buying” 1,000+ boxes of jello with coupons is to market a web site? Seems like a smart idea to me…but people say I’m crazy :)

  9. I wish this could have appeared instead of the WSJ article. It was so lopsided is it any wonder why people have the mistaken notions (as evidenced on the thread) of coupons that they do.

  10. Very well said, Julie. I read the article and the comments posted and all I can say is…their loss. Couponing has helped my family by me not having work and still being able make ends meet comfortably. If they choose to spend all their money on full price goods, so be it. This is a wonderful site that has helped my family out tremendously. Keep up the GREAT work…and don’t do anymore WSJ interviews:)

  11. Wow, I am pretty much behind the times on this one but I just wanted to add my 2 cents. I started couponing about a year and a half ago and I do not have the storage space to stockpile for more than about 3 months so that is what I do. I started couponing because my husband’s income was becoming a bit unstable. We were still doing quite well but I just wanted to make sure we would continue that way. However, on May 19th (a few weeks ago) I was laid off from my full time well paying position in which I carried all of our benefits and it has been extremely scary. But I will tell you this. I may not have a ton of money in the bank and health insurance is definately a concern I am not worried about meeting our household expenses and especially not groceries. I have toilet paper, tooth paste, laundry soap etc. to last us a while and otherwise I have the means and the intelligence to replace it at a cost we can afford. THANK GOD FOR COUPONING!!! We would be in such worse shape if I had not learned this a long time ago. Now as a ‘pay it back’ and since I have time I did not have I am donating my time at our YMCA and teaching a couponing class for members who are struggling. What a pitty that the media has to turn such a blessing for American families into a travesty. The ignorance of that reporter is so blazen he should be embarassed and the WSJ should be as well for putting him on their payroll. REDICULOUS!

    THANKS FOR ALL YOU TO TO HELP US!! YOU ARE A BLESSING!

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