Funny about Money

The only thing necessary for the triumph of evil is for good men to do nothing. ―Edmund Burke

AMEX Windfall…Disappointing and Not Disappointing

The annual rebate from Costco’s American Express arrived late last week. It was only $157, the lowest kickback I’ve ever received from that august credit card company. Compare with last year’s refund of $337, and the $210 they sent in 2009. Pretty pathetic.

Of course, what it says is that in 2010 I cut spending way, way back. The only major purchase I made was for M’hijito’s dryer—since he pays for everything in cash, we charged it on my card and he reimbursed me so I could get the kickback. If it hadn’t been for that purchase, the rebate would have been even less.

In one respect the small check is not so disappointing: it means I succeeded in cutting my budget to unheard-of low levels. Of course, that happened because I had to cut back: I had no money.

Like everyone else, evidently. Spending dropped drastically across the country as more and more Americans fell victim to layoffs, forced “retirements,” furloughs, and pay cuts.  Reports tell us we’ve seen a recent  uptick in consumer spending, with an increase of 4.4 percent in fourth-quarter 2010. That’s good for the economy, I guess. One could speculate about pent-up need, though: at some point along the line people simply have replace cars that crap out and household infrastructure items that break—such as M’hijito’s clothes dryer. As experience tells us, all these things are engineered to break at once. Will people keep on buying after they’ve replaced the things they can’t do without?

Oh well. I could’ve used a larger kickback. On the other hand, a couple of other windfalls blew in: the RASL payment and a couple of new jobs from new and old clients. So, what the heck. I’ve learned to limit spending, and don’t expect to increase it for the sheer joy of seeing a few extra pennies in the annual AMEX rebate.

How about you? Now that you’ve tightened your belt, do you intend to loosen spending if and when times get better, or will you continue to cultivate your new frugal habits?

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Author: funny

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9 Comments

  1. It IS weird that people spend more for the rebates: I’ve seen several articles on that.

    I’m hoping to start spending a bit more–but not as long as there are rumblings about changing tenure rules.

  2. I always look at stuff like that as ‘free’ money so I don’t get too worked up at how much (or how little) it is, and I certainly don’t ‘count on it’ for anything other than a pleasant surprise. It sounds like the Costco membership paid for itself which is always a good thing if you look at it from that perspective.

  3. I will continue to monitor every cent regardless of our financial situation because I have learned that this is the only way for me to remain accountable to our 5 year financial plan. I have already blown through over a million dollars over the past ten years so I’ve had already had my ‘fun’ 🙁 … and then some.

  4. @ frugalscholar: Dunno that I actually spend more specifically to collect the rebates. It’s that I use the AMEX card for as many routine purchases–groceries, gasoline, yard and pool stuff, clothing–as possible and avoid using the Visa card unless a merchant absolutely will not take it. A retailer that won’t take AMEX has to be pretty special for me to shop there; a couple here in town are. But most of them: if what they’re selling is available somewhere that will take my card, that’s where I’ll shop.

    You know, it’s just hard to believe they can retroactively change the terms of tenure for people who already have it. Isn’t tenure a contract? In AZ supposedly a tenure-track line is funded for the projected lifetime of the candidate being hired as assistant. They can eliminate a tenure-track line when a person leaves, retires, or dies, thereby getting rid of tenure by attrition (which is what we’re seeing here). But you’d think faculty would go to the barricades if suddenly one day tenured people found themselves untenured.

    Hereabouts, the strategy is to make it absurdly difficult to get tenure and then, once you are tenured, to make it ridiculously difficult to advance from associate to full. They’re telling even full bulls that if they don’t produce several articles in top-tier journals and a book every couple of years, they get to teach 4 & 4, with classes numbering in the hundreds. The point is to push tenure-track people to look elsewhere, which they would do if there were any jobs to be had in any elsewheres.

    Hmmm… Now to see if Blogger will let me comment at your site. Yesterday some sort of glitch in Firefox hung up the comments function.

    @ Money Beagle: Yes, I also regard these things as a pleasant surprise and usually end up spending it on stuff, though not necessarily on Costco’s stuff. I cash the check (you can only do so at a Costco store–it also serves as a voucher for CC products, which obviously is what they think you’ll use it for) and put it into monthly diddle-it-away savings. In flusher times, I’ve been known to send it to Vanguard to add to long-term savings, but these days I actually do need the money to live on.

    It’s interesting, though, how much less you get when you deliberately economize…and how that must represent the effect of Americans’ changed spending habits on retailers and manufacturers. Or, to translate that into the Third-Worldization we’ve been watching for some time, the pressure on poor folks (including members of the former middle class) to spend windfalls rather than to save.

  5. I fully intend on continuing to save. Like your Costco membership, my Sam’s Club membership pays for itself. All I need to do to cover my membership costs is to buy my year’s worth of salt pellets for the water softener. That means all else saved there is truly money saved.

  6. Unexpected money is always welcome, I suppose. We don’t use our lone credit card much, and it doesn’t have any perks, but on the other hand it’s a 6% rate. We do get a yearly rebate from USAA insurance, thought, and it seems that last couple years it’s been spent on fabric and whatnot by the Mrs. Got to feed that fabric habit.

  7. Just like everything else, depends on how you look at it. Is the glass half empty or half full? Initially, I would think I got ripped off since my rebate is smaller, but after the dust clears, I would have come to the same conclusion you did. Similar to tax refunds, too. Still staying frugal, however did recently move so may need to stimulate the economy with some furniture. They will be on sale, of course! 🙂

  8. Keeping very frugal habits because my income was cut by one third and am into the 2nd year of looking for a teaching job. Being in my 50s, I know that the valleys can be very long and deep, as I continue in it. It is so ingrained in me now, it’s part of me. Coupons, sales, thrift stores and craigslist. Never go to a mall and buy anything. I am very aware that even if the good times come again, they can stop in an instant as I know so well from personal experience. Sorry to be Debbie Downer, but I feel as if I have been run over by a truck economically.

  9. Correction: my income was cut by two thirds. I earn 1/3 of what I did.