Paycheck Chronicles

Tricky Discount Math - Think Ahead For Max Benefits

If you use coupons, discounts, and deals to do your shopping, and you sometimes return things, think ahead to ensure you're applying your discounts and deals in the best possible way. This is especially true if your purchase includes the use of any type of retailer money, such as Kohl's Cash or Macy's Money.

When you make a purchase using some discounts and almost all retailer money, the amount of the discount is distributed across the total amount of the purchase. That lowers the return value of each item that you have purchased. If you know that you may be returning some items, but you'll definitely be keeping other items, being strategic can mean that you get more money back on the items you return.

For example, let's say you have $20 in Kohl's Cash. You go to Kohl's and purchase a serving bowl for $10, a set of salad tongs for $10, and two sets of kid's pajamas for $10 each, for a total of $40. If you ring them all up together, you'll pay $20, and the return value of each item will show as $5.

Chances are, you are more confident about some of your purchases than others. In this example, you may know that you'll keep the serving bowl and salad tongs, but you're not sure if the pajamas will fit your son. As it turns out, the pajamas are too short, and so you return both pairs, receiving just $10 back.

However, you could have rung the purchases up in two different and received $20 back when you returned the pajamas. In the first transaction, pay for the serving bowl and salad tongs, with your Kohl's Cash. They'll have zero return value, since they were paid in full with Kohl's Cash, but that's OK because you're not going to return them. Then, pay for the pajamas with the same $20 spent in the original example. Because no Kohl's Cash is used on the pajamas, they retain full refund value and you'll get the full $20 back if you return them.

I'm sure some people will think this is devious or deceitful, but I disagree. You could very easily have just purchased the serving bowls and salad tongs with your Kohl's Cash and had exactly the same outcome. It is only devious or deceitful if you are manipulating the system to an outcome that wouldn't have happened naturally, and that isn't true in this example.

Thoughtful application of discounts and deals can make a big difference in how much you pay in the big picture. Take a minute when using these discounts and deals to make sure you're getting the best value for your money.

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