What to Buy on Amazon Prime Day (and What to Skip)

what to buy on amazon prime day

I’ve been thinking a lot about what to buy on Amazon Prime Day. It’s a great time of year to get good deals. However, it’s also a big bonanza sale that’s very hyped up. Therefore, it’s easy to get sucked into the indulgence of consumerism. In other words, if I’m not careful, I know that I can end up wasting money on impulse buys over this two-day sale.

That’s why I want to have a plan. If I’m going to do some Amazon Prime Day shopping, then I need to focus ahead of time on what to buy. I need to make a list and some rules. I need to stick to that. If I’m focused then I’ll make the most of this consumer holiday without wasting money.

What is Amazon Prime Day?

Amazon Prime Day is a huge set of deals available on the site for a 48-hour period starting July 15th. However, there are also pre-day deals leading up to the actual sales day. All of these deals are only available to people who are Amazon Prime members.

I actually gave up my own Amazon Prime membership this year. If I want to take advantage of the deals, then I need to sign up again. They do offer a 30-day free membership. However, I’ll have to find out if that deal is available to former members. If not, then I won’t buy anything because I’m not ready to pay for a new annual membership.

What to Buy on Amazon Prime Day

If I’m able to get the Amazon Prime membership then there are only a few things that I want to buy on Amazon Prime Day.

Things I Buy Regularly on Amazon

The main thing I want to buy on Amazon Prime is the stuff that I already buy on Amazon. If I buy them anyway, then it makes sense to see if I can get a discount on them for Prime Day. In particular, I’d love to get some good deals on non-perishable items I can stock up on. Here’s my plan:

  • Go through my past orders and look for recurring purchases.
  • Check if any of those items are on sale for Amazon Prime Day.
  • If they are, purchase as many as possible (within reason) to get them at the best price.

Some of the types of things I might want to buy on Amazon Prime Day that fall into this category include groceries, home cleaning supplies, dog food, undergarments, pillows, and bath products.

After going through the old Amazon orders, I’ll also make a list of things I buy regularly such as those above. Maybe I buy them at other stores so they aren’t in my Amazon orders. I’ll check to see if I should get those during Amazon Prime deal days.

Stuff I’ve Been Wanting to Buy on Sale

There are a few things that I’ve been wanting to buy, even though I don’t purchase them regularly. I’ve been waiting for them to go on sale. Some of those things are already in my Amazon cart (“saved for later.”) Therefore, I’ll start there. Then I’ll turn to the list in my journal of “stuff I want to buy on sale.”

These are all things that I want, and I’ll use, but they aren’t necessities. For example, I’ve wanted a new swimsuit for years. I could use a new comforter for my bed. I periodically update my dog’s toy box with new items. I’d like to add to my existing art supplies.

These items are what to buy on Amazon Prime Day. The caveat is that I must already want them (not just desire them because I’m browsing the site) and they must be a good deal.

Planning Ahead for Christmas

Finally, I want to think ahead about Christmas presents. I do not purchase a lot of gifts each year. I tend to make scrapbooks and small handmade items for people. Or not do gifts at all. However, there are a few people that I like to get things for each year. Before going on the site, I’ll brainstorm a list of the types of things I might want to get for them. If I found those on sale on Amazon Prime Day, it would be worth the cost to me.

What Not to Buy on Amazon Prime Day

If something doesn’t fall into one of the above categories, then I’m 90% sure that I won’t buy it on Amazon Prime Day. It’s really important to me to be a conscious shopper. Impulse buys are a waste of money. If I’m going to waste money, I’d rather use it to support local stores. Therefore, I truly want to stick to my list.

In addition, here are some things I keep in mind about what not to buy on Amazon Prime Day:

  • Perishable items
  • Things I would never buy normally
  • Gadgets that look so fun; history says I’ll never use them
  • Clothes and shoes, because I have plenty (except for that swimsuit and underwear)
  • Big ticket items; they’re tempting because of great discounts but spending a lot of money is still spending a lot of money

If I go into it with a good plan than I should know what to buy on Amazon Prime Day and what to skip. Do you have a plan for shopping on days like this?

 

Photo credit: Mein Deal  

 

 

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Want to Retire Early? Be Aware of These 5 Financial Risks.

early retirement

Many people want to take early retirement. If you’ve saved up enough money then why not? Well, first of all, you have to be sure that you’ve saved up enough money. Many people think that they have planned accordingly only to realize that there are a lot of financial downsides to early retirement.

Here are five of the biggest money problems that people tend to face in early retirement:

1. Failing to Plan Properly for Taxes

Did you know that many people are in a higher tax bracket at retirement than for much of their working career? This means that you’re likely to owe more at tax time than you’re accustomed to. Moreover, once you start taking out your 401K money, you’ll have to pay taxes on that.

Therefore, taxes in retirement can be pricey. If you haven’t planned ahead, then you’re going to have to readjust for that reality. If you retire early, then you’ll have to start figuring that out years ahead of your peers.

2. Years and Years of Spending Ahead

That brings us to the next key point. If you retire early then chances are that you’ll have more years of retirement. Therefore, you’ll have to make your retirement income stretch. If you retire at 55 instead of 65, that’s ten less years of earning and ten more years relying on retirement income.

3. Where Will Your Money Come From?

You won’t even be able to access some of your retirement funds, such as your 401K, until you hit a certain age. Therefore, you’ll have to figure out where you’re money is going to come from prior to that. If you haven’t planned in advance, then you can easily find yourself overspending in those early years. If you tap into your savings or refinance your home to cover those costs then you’ll have to find some way to make up for it later.

4. What About Healthcare?

Just because you retire early doesn’t mean that you can access Medicaid early. Therefore, you’re going to have to figure out how to pay for health insurance until you reach regular retirement age. If you’re not working anymore then you can’t count on employer rates. Your health insurance could get very expensive very quickly.

Even though you’ve retired early, you’re old enough that you can’t risk going without healthcare. If anything were to happen, your care costs would be exorbitant. Therefore, you do have to pay out of pocket for health insurance. How are you planning to do that if you’ve retired early?

5. You Don’t Maximize Your Retirement Benefits

If you take early retirement then you may not make as much money post-retirement as you could have. For example, if you have a job that pays a pension, the pension amount might be significantly lower if you retire early. Likewise, if you start access Social Security early (“early” currently means age 62) then you won’t get as much as if you’d waited. So, you start using the money sooner and yet you’re getting less of it than you could have. Waiting to retire could be well worth it.

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401K Drawbacks: Don’t Forget That Money Is Taxed When You Use It

401k drawbacks

More and more people are focused on growing their 401K retirement savings. That’s a great thing. You need to have money when you retire. You want to have a diverse array of retirement income options. Maxing out your 401k contributions is a wise thing to do. However, there are 401K drawbacks. You shouldn’t forget about those as you plan for your future.

401K Money Is Taxed When You Withdraw It

People frequently seem to forget that one of the biggest 401K drawbacks is that you have to pay taxes on that money. You don’t pay taxes when you deposit it. People love that part. In fact, contributing to your 401K plan is a great tax benefit when you’re still working.

However, when you reach your retirement and start using that money, you’ll have to pay taxes. That can be a huge shock if you haven’t planned for it in advance. The money is taxed as though relative to your income. Therefore, if you’ve done a great job of setting yourself up with a high level of retirement income, you could find that you have to pay more than a third of your 401K withdrawal money to taxes.

On the plus side, if you’re in a lower income bracket post-retirement than you were before you retired, then you may have set yourself up for some success. You’ll still need to pay taxes on that money, of course, but the hit might not be as big as it would have been if you didn’t set that money aside. There are clearly pros and cons.

Plan Ahead for Withdrawing Your 401K Money

The big question isn’t whether or not to set aside money in your 401K. If you have the option, the benefits outweigh 401K drawbacks. The issue is that you simply have to plan ahead. Make sure that you’re fully aware of how much money you’re going to have to pay to taxes when the time comes.

The biggest problem is if you fail to think about taxes when you mentally plan for your retirement years. If you just look at what’s in your 401K and assume that’s how much money you’ll have when you retire then you’re going to be in for a shock. Make sure that you’re thinking realistically about how you’ll use that money each year and what amount of it will go to taxes.

Other Tips for Minimizing 401K Drawbacks

You might want to look now to see if you should have a Roth 401K instead of or in addition to your traditional 401K. That money gets taxed ahead of time, which means that you won’t have to worry about paying taxes on it once you’re in retirement. If you have the ability to maximize contributions to both types of accounts now then you’ll set yourself up well for financial success in retirement.

Then, once you’re in retirement, make sure that you use the Roth 401K money first. Or for that matter, use any money that isn’t taxable in retirement. You want to withdraw as little money as possible that will require you to pay taxes. Pay attention to your tax bracket and the impact that withdrawals will have on that. As long as you plan in advance, you can minimize 401K drawbacks and make the most of your money.

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