Finance expert sounds alarm over 'spaving' trend: An old 'trap' with a new name hitting your wallet

Though there are times "spaving" is worthwhile, one personal finance expert outlined how consumers can avoid becoming the "victim" of the marketing ploy.

"The whole concept of 'spaving' is to get consumers to buy more," Kuderna Financial Team founder and "What Should I Do with My Money?" author Bryan Kuderna told Fox News Digital. 

"You see different examples like that all throughout the economy. And where it hurts the consumer is if it encourages them to essentially waste money to buy more than it's necessary, just so that they feel like, okay, now I'm getting the deal."

INFLATION REDUCES BUYING POWER AS $100 GOES A LOT LESS FAR THESE DAYS

Some of the most prominent "spaving" deals are promotions like "buy one, get one," in-store "cash" to use on future purchases, free gifts or even programs like "subscribe and save."

"They're all just different marketing ploys to get consumers to buy more, and in certain instances that works great," Kuderna said. "If we're using coupons to get what we need, and we also got a bargain at the same time, then certainly it's a win-win. But as we see so many times… it's not."

Americans have been struggling under the weight of inflationary pressures for years and higher prices after COVID lockdowns prompted more households to rely on credit cards to make purchases. 

From 2021 to the end of 2023, credit balances jumped 47% - the steepest three-year climb on record. Credit analysts also predict the 2024 first quarter credit card debt will likely smash record highs.

With finances proving a struggle for many American families, Kuderna offered some advice for consumers on how to overcome the "spaving" trap and keep control of their money. 

"The best way consumers can approach a spaving deal is to pretend it's not even there like they never saw it," he shared. 

GEN Z LEAN ON CREDIT MORE THAN MILLENNIALS DID AND RACKING UP MORE DEBT

Consumers must first remind themselves to "buy what you intend to buy," he stressed. 

"Don't buy what you feel pressured to buy. That's when you become almost like a victim of the marketing ploy. And that's obviously good for the retailer but not good for the consumer."

He also reminded consumers to exercise "caution" when it comes to store credit cards, despite sign-on bonuses and cardholder perks.

"The reason you see a lot of those really cool perks is that these store credit cards are so profitable to that retailer, and that's where people can get in sometimes if they're carrying those balances. What they may end up spending in interest on their store credit card or late payment fees or anything else could pale in comparison to that little savings that they got at one time when they opened the credit card."

Financial planner Bryan Kuderna explains the spaving trend and outlines how consumers to avoid falling for the trap. (Getty/Fox News Digital)

Kuderna also advised turning off app notifications or unsubscribing from emails if consumers feel "lured" into buying by those marketing messages.

"Lastly, what I sometimes tell people is a lot of these [spaving deals] are based on buying in bulk and buying in bulk in economies of scale is great for the consumer. But again, if we're overstepping and starting to create waste, it's not," Kuderna added. 

"Know what you want to get and if you want to go there, go there, but don't get that same volume at a normal retailer where you're paying significantly more just to get a small savings," he said. "That's where you have to look at what is the net savings of actually falling for some of these saving deals."

As "spaving" traps become more common and spread to new sectors like online gambling and streaming services, Kuderna urges consumers to be vigilant and avoid becoming a financial victim.

"Sometimes you just have to kind of sit down and go back to basics and say, okay, are we getting what we pay for here?"

GET FOX BUSINESS ON THE GO BY CLICKING HERE