Money Management

Members can save money at Sam’s Club, but the company also makes it easier to open your wallet for impulse purchases. Read on to find out how the company does it. 

Sam’s Club is a favorite among frugal shoppers, but that doesn’t mean the discount warehouse club isn’t on the lookout for ways to get shoppers to spend more money.

Some of its strategies are similar to what other retail stores do to encourage more spending, while others — like the company’s growing list of available services — are more unique to discount warehouse clubs.

Here are six clever ways Sam’s Club gets you to dig a little deeper into your wallet.

1. Rotating product availability

FOMO, or the fear of missing out, is alive and well in the retail space. Sam’s Club offers a constantly rotating selection of inventory that makes each visit feel different than the last. Seeing new items is exciting and can make you feel as if you’ll miss out on a purchase if you wait to buy it.

Seasonal items are particularly enticing because many people space out their Sam’s Club trips, which means you really might miss out on the latest seasonal items if you don’t scoop them up on your next trip. Research backs up this idea, too, with 62% of people reporting feeling good after making an impulse purchase, according to a survey by SlickDeals.

2. Discounts on expensive items

Just as seasonal items convince buyers to spend more, Sam’s Club offers limited-time discounts on expensive items that persuade shoppers to buy. For example, let’s say you go to Sam’s Club twice a month, and see a $100 discount on a $600 vacuum.

If you’re interested in owning a new vacuum, then the $100 discount may convince you that you need to buy that vacuum now. Maybe you really needed the vacuum, and maybe you didn’t, but either way, you walked out of the store spending $500 more than you planned to.

The American Marketing Association says coupons and other discounts can entice consumers to spend more than planned. “The common intuition is that larger discounts lead to an increase in the mental budget and therefore higher spending levels,” the association says on its website.

3. Bulk purchases

Buying in bulk makes a lot of sense for large families, businesses, or when hosting a big party. But the fact that Sam’s Club customers have to buy in bulk means that, at least for some items, you’re buying more than you need and spending more, too.

There’s a large jug of garlic in my fridge that came from a discount warehouse club. It’s probably 20 times more garlic than I need, and I can’t help but think that I overspent every time I see it.

4. Easy purchases with technology

Sam’s Club Scan & Go app makes it easy for in-store shoppers to scan and pay for items. And while it’s a way to make shopping more convenient for members, it’s also a way to encourage more spending.

For example, you can use the Scan & Go app to buy big, expensive items like TVs and have them shipped directly to your home. While convenient, it also removes a barrier that used to keep some people from making a bulky purchase at the store. For some customers, the temptation to buy expensive items through the app could derail some of their personal finance plans.

5. Free samples

Free food samples are a trademark of discount membership clubs. While delicious, those samples aim to get you to try out a new product and buy it that day.

And the research suggests that samples are very effective. The online e-commerce platform company Shopify referenced a Cornell University study that found that customers who enjoyed a wine tasting at a winery were 93% more likely to spend an extra $10 at the winery.

6. Additional services

Sam’s Club isn’t just a convenient place to buy groceries; you can also use your membership for a wide variety of services, including buying glasses and hearing aids, booking a vacation, buying tires, printing photos, and getting your pharmacy prescriptions filled. The company even has its own credit cards.

Having all of these services located in the same place makes it much easier to spend more money at Sam’s Club, even if it’s just a few extra dollars to print a few photos.

While plenty of people use their Sam’s Club membership to save money, it’s always a good idea to keep your budget in mind when shopping. Sticking to a strict budget — and even using a budgeting app to track spending — can be a great way to ensure you’re not overspending on your next trip to Sam’s Club.

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The Ascent does not cover all offers on the market. Editorial content from The Ascent is separate from The Motley Fool editorial content and is created by a different analyst team.The Motley Fool has a disclosure policy.

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A Costco membership doesn’t make sense for everyone. Read on to see why you may want to pass. 

When you join Costco, you’re not exactly making a huge financial commitment. After all, a basic membership only costs $60 a year. And even if you decide to upgrade to an Executive membership for $120 to score 2% cash back on your Costco purchases, it’s still not a ton of money in the grand scheme of things. Plus, the savings you reap by shopping at Costco might more than make up for your membership fee.

But while joining Costco may be a natural move for some people, that doesn’t mean it’s the right choice for you. Here are a few scenarios where a membership may not value out.

1. You don’t cook or eat at home often

Shopping at Costco could result in a lot of savings on groceries — both perishable and non-perishable items. But if you don’t tend to cook or eat at home very often, then you may be used to a mostly empty fridge. And if you join Costco, you may be tempted to load up on groceries you don’t end up using.

2. You don’t live near a Costco

Shopping at Costco is convenient if you have a warehouse club location nearby. If you don’t, then part of your savings might be negated by the money you have to spend on gas to drive to the store.

And then there’s your time to consider, too. It may not be worth spending an hour on the road to shave $20 off of your grocery bill when you have work and other things to do.

3. You don’t have room for bulk items at home

You can’t buy a single box of tissues at Costco — it just isn’t an option. Rather, the groceries and household items you’ll find at Costco are available in bulk sizes. If you don’t have space at home to store larger quantities of food and supplies, then there’s no sense in joining Costco.

You don’t want to risk a scenario where you’re forced to stash a 12-pack of extra-large paper towels under your desk because there’s no place else to put them.

4. You already have a Sam’s Club membership

Buying groceries and household supplies in bulk could save you a lot of money. But if you already have a Sam’s Club membership, then joining Costco on top of that may not do much for you.

Sure, Costco and Sam’s Club don’t have the exact same inventory. But a lot of the items you’ll find at both chains overlap to some degree. And if you’re used to buying bulk toilet paper and cleaning supplies at Sam’s Club, then there’s probably no need to also buy those items from Costco.

5. You’re extremely picky about the brands you use

Costco carries a variety of brands. But if you’re really particular about the brands you buy and you refuse to stray from them, then a Costco membership may not be your best choice. You may be better off sticking to your local supermarket if you know it carries the brands you love.

Plus, a good way to save money at Costco is to load up on Kirkland products. If you’re not willing to give those a try, then you may not get as much out of your membership.

A Costco membership makes sense for a lot of people. But it may not make sense for you. And if any of these factors apply to you, you may not want to spend your money, even if a $60 membership fee is all it takes to get you in the door.

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We’re firm believers in the Golden Rule, which is why editorial opinions are ours alone and have not been previously reviewed, approved, or endorsed by included advertisers.
The Ascent does not cover all offers on the market. Editorial content from The Ascent is separate from The Motley Fool editorial content and is created by a different analyst team.Maurie Backman has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Costco Wholesale. The Motley Fool has a disclosure policy.

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Bringing a child into the world? Read on to see why you might need even more cash reserves. 

Having a baby is an incredible experience, but it’s one you need to prepare for mentally, logistically, and financially. If you’re having a baby, it’s important to give your emergency fund a boost before your little one arrives. Here’s why.

1. Your leave might be unpaid

The Family and Medical Leave Act (FMLA) entitles certain workers to 12 weeks of leave for the birth of a child during which time their jobs are protected. But that law doesn’t require your employer to pay you. Depending on your company’s policy, you could end up going without a paycheck for some or all of that time, so it’s best to give your savings account balance a boost so you don’t struggle.

Of course, what you should really do is sit down with your employer ahead of time and see what pay, if any, you’re entitled to. You may be eligible for some sort of payment if you have short-term disability insurance through work. Get all of the details so there are no surprises later.

2. Daycare could cost a fortune

If you’re planning to return to work after having a baby, you may need to pay for daycare if you don’t have a family member who can look after your little one. But the cost of daycare today might shock you.

Care.com reports that U.S. daycares charge an average of $284 a week. And that could easily eat up a large chunk of your paycheck.

Now, you may be thinking you can avoid paying for daycare if you happen to work from home. But most people who work full time can’t manage an infant and a job. After all, how’s it going to look if you’re supposed to be in a Zoom meeting but there’s a crying baby in the background?

3. You might face your share of healthcare bills

Even if you have good health insurance, having a baby won’t necessarily be free. The Kaiser Family Foundation reports that the average out-of-pocket cost for women to deliver a baby in a hospital is $2,854 among those enrolled in large group health plans. But your costs may be higher or lower depending on your specific insurance coverage and the type of birth you have.

But it’s not just healthcare bills related to your delivery you need to think about. You might also face your share of medical bills during your baby’s first few months of life. So it’s important to make sure you’re equipped to cover them.

How much emergency savings should you aim for?

When it comes to emergency savings, the general convention is that it’s wise to sock away enough money in the bank to cover three full months of essential bills at a minimum. But if you’re having a baby, it’s a good idea to save beyond that if possible.

Remember, too, that baby gear isn’t cheap. You may get some items gifted to you if someone throws you a shower and your friends are generous. But you’ll need a host of supplies, from furniture to car seats to strollers, not to mention clothing and a steady supply of diapers. So for all of these reasons, it’s a good idea to pad your savings prior to having a baby if that’s something you can swing.

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We’re firm believers in the Golden Rule, which is why editorial opinions are ours alone and have not been previously reviewed, approved, or endorsed by included advertisers.
The Ascent does not cover all offers on the market. Editorial content from The Ascent is separate from The Motley Fool editorial content and is created by a different analyst team.The Motley Fool has a disclosure policy.

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Sephora’s Beauty Insider program is free to join. Shoppers who spend $1,000 yearly can reach Rouge status and get more perks. Find out if it’s worthwhile. 

For shoppers who are brand loyal, it can be advantageous to join rewards programs. Many retailers offer free loyalty programs as a way to reward frequent shoppers. If you make regular purchases, joining to earn discounts and free products could be worthwhile.

Popular makeup and skincare company Sephora has a free loyalty program called the Beauty Insider Program. The program has three tiers, and the highest tier is Sephora Rouge. Do you shop at Sephora often? Keep reading to discover whether Sephora Rouge is worth it.

Introducing Sephora Rouge

Sephora’s loyalty program, Beauty Insider, has three status tiers: Insider, VIB, and Rouge. You’ll be eligible for benefits and reward opportunities, which vary by tier level. It’s free to join, but the two higher tiers have required annual spending minimums to achieve.

As a member, you’ll earn Rouge status once you spend $1,000 in a calendar year on eligible Sephira merchandise purchases. Here’s a breakdown of some of the top benefits you get as a Sephora Rouge status member.

Free standard shipping with no order minimum.20% off during seasonal savings events.4x points during point multiplier events.5% off on subscription orders.$10 off qualifying purchases when you redeem 500 points.Access to Rouge Reward perks, allowing members to redeem 2,500 points for a $100 voucher.

Achieving Sephora Rouge status can open you up to more perks. However, several benefits aren’t too different from those offered to members at other tier levels. Additionally, some benefits, like the Rouge Reward, aren’t as straightforward as you might think.

As a Sephora Rouge member, you can redeem 2,500 points for a $100 voucher to get $100 off a Sephora purchase. The entire value must be used in one transaction, and no other promotions or discounts can be combined, so you can’t also use your 20% off discount if you’re using your voucher during a seasonal sales event.

Additionally, you must use it within 90 days, and all items purchased with it are final sale. You can exchange your points in Sephora’s Rewards Bazaar to claim your Rouge Reward. Rouge Rewards are released on Tuesdays and Thursdays around 9 a.m. PST, but supplies are limited. These details are worth noting, as it’s arguably the best perk available to Rouge status members.

To help you compare each tier, here’s a breakdown of the benefits offered with each status level below.

So, is Sephora Rouge worth it?

If you’re already spending at least $1,000 annually at Sephora, you may benefit from earning Sephora Rouge status through the Beauty Insider program. Getting additional discounts and more reward opportunities could help you keep more cash in your checking account. But if you typically spend much less, don’t risk overspending to reach Rouge status. It’s best to avoid credit card debt if possible.

If Sephora Rouge isn’t a good option for you, it may be beneficial to explore other beauty store rewards programs, like Ulta’s Ultimate Rewards program. Other rewards programs like this could be a better fit for you depending on the perks you value and your purchase habits.

Are you looking for other ways to save money? Check out our personal finance resources for tips.

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We’re firm believers in the Golden Rule, which is why editorial opinions are ours alone and have not been previously reviewed, approved, or endorsed by included advertisers.
The Ascent does not cover all offers on the market. Editorial content from The Ascent is separate from The Motley Fool editorial content and is created by a different analyst team.Discover Financial Services is an advertising partner of The Ascent, a Motley Fool company. Natasha Gabrielle has no position in any of the stocks mentioned. The Motley Fool recommends Discover Financial Services. The Motley Fool has a disclosure policy.

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Costco members can score exclusive insurance discounts and special perks. Read on to find out how. 

If you’re a Costco member, you may be surprised to know that there are benefits beyond gaining access to the stores, including the ability to purchase homeowners insurance.

Costco offers homeowners insurance through American Family Insurance and you don’t have to be a Costco member to sign up for a plan. But if you’re a Costco member, you may receive a discount when you sign up for a Costco CONNECT insurance policy and have access to a few special perks as well.

Here are six home insurance perks Costco offers through its insurance plan.

1. Exclusive insurance discount

The best perk for Costco members who buy homeowners insurance through the company is that they have access to exclusive discounts on insurance plans.

While it’s not guaranteed that you’ll receive a discount, the American Family CONNECT website says that members receive a “Costco member-only discount on auto and home insurance in most states.”

You won’t have to do anything extra to receive a potential discount either. Just provide your Costco membership number when you sign up for an insurance policy.

2. Identity theft protection

Another significant benefit of signing up for homeowners insurance through Costco is that you get identity theft protection. American Insurance says that if your identity is stolen, your policy may cover costs related to the theft, up to $5,000.

3. Stolen credit card and check fraud protection

Costco members with a CONNECT homeowners policy can also get access to coverage for losses if their credit card is lost, stolen, or hacked, according to American Insurance. The company says you won’t have to pay the deductible on the claim either.

4. Spoiled food replacement from a power loss

One common annoyance many people can relate to is having to throw food out because it went bad after a prolonged power outage. Costco feels your pain.

The company’s home insurance plan may cover up to $500 of spoiled food if it’s the result of a power outage. Just be sure to check the details. Homeowners in Texas and Florida won’t get the perk.

5. Glass repair or replacement

Accidents happen, and if one of the windows in your house breaks, you could receive up to $1,000 for the cost of the repair or replacement. Just try not to break too many windows, as the policy covers no more than two window replacements in 12 consecutive months. Also, keep in mind Costco lists this benefit as a unique perk for Costco Executive members.

6. Home lockout assistance

There’s no getting around the fact that getting locked out of your home is a huge pain. But for CONNECT insurance policyholders with a Costco Executive membership, you have lockout protection 24 hours a day, seven days a week.

The plan covers up to $100 per occurrence, and you’re limited to two claims per 12 months. So if this happens regularly, maybe hide a key somewhere safe.

While these perks are certainly a good deal, it’s still important to shop around for the best homeowners insurance if you’re looking for a new policy. Spending a few minutes comparing different companies’ insurance rates, deductibles, and coverage will help you make the best decision.

If cost is the most important factor in which insurance company you’re looking for, you can take a look at our list of the best cheap home insurance. Just remember that not all policies offer the same coverage or benefits, so take a close look at the details to make sure you’re getting exactly what you need.

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We’re firm believers in the Golden Rule, which is why editorial opinions are ours alone and have not been previously reviewed, approved, or endorsed by included advertisers.
The Ascent does not cover all offers on the market. Editorial content from The Ascent is separate from The Motley Fool editorial content and is created by a different analyst team.Chris Neiger has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Costco Wholesale. The Motley Fool has a disclosure policy.

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