The growing popularity of online deal sites like Groupon and LivingSocial could be encouraging many consumers to make impulse buys rather than save their money for more important financial priorities, according to the American Institute of CPAs.
In a new survey released on Thursday, the AICPA found that 23 million Americans, or roughly 10 percent of the adult population, have purchased a coupon from an online site like Groupon or LivingSocial in the past year.
Forty-nine percent of the survey respondents reported that they used the coupons for items they needed, while approximately the same proportion, 48 percent, said they used the online coupons for items they just wanted to have. But there was a disparity between the sexes. More than half of the men surveyed, or 53 percent, said they bought coupons for products or services they wanted, while an equal percentage of women got coupons for items they needed.
“The crux here is ‘need’ versus ‘want,’ ” said Jordan Amin, chairman of the National CPA Financial Literacy Commission. “We all love a great deal—and we encourage consumers to pursue any opportunity to save on items they need. A purchase, though, is always an exercise in prioritization. Spending on too many wants, no matter how great the perceived value, is lost opportunity for retirement or other savings.”
The survey found that Americans are struggling to sock away money for the future. More than half of Americans, 56 percent, are unable to save, and 4 in 10 working adults say they’ll never afford retirement. The challenge of saving is exacerbated now by rising fuel and food prices. Six in 10 adults have changed their behavior to contend with rising gas prices. Forty-eight percent of Americans have modified their behavior to deal with rising food costs.
In the face of these challenges, an increasing number of retailers are turning to online deal sites and flash sales to attract consumers. According to the survey results, such offers are especially appealing to younger shoppers. Americans aged 25 to 34 are more likely than any other age group to have purchased a coupon from Groupon, LivingSocial or another online deal site within the past year.
“In our growing deal culture it’s important that consumers take a step back,” Amin said. “When they encounter these offers they need to think through their needs, the actual value of the deals and the financial tradeoffs that come with spending money instead of saving it. Money doesn’t come easily. We want to make sure it doesn’t go easily, either.”
Harris Interactive conducted the survey by telephone for the AICPA, calling 1,005 U.S. adults between March 23 and March 27. The survey was conducted in recognition of Financial Literacy Month in April.
The National CPA Financial Literacy Commission oversees two programs to help Americans achieve financial well-being. The first,
A second program,
