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July 10, 2009

Ask-o-logy: Savings or Profit -- which to aim for?

Yesterday I posted the first half of the Money breakdown.

Today, I'm going to dig a little deeper. I've run the numbers, and the results totally surprised me. Here goes.

My next question is:

1) Which type of monetary transaction was more worthwhile? Trying to save, make a profit, get refunds, or track down funds owed to me?

As you recall, I asked 150 times in the Money category. Yesterday I identified four types, or aims, for these requests: those resulted in "Profits," "Savings," "Recouped" funds, and what I "Was Owed."

Here's a graph that compares how many successes I had in each type and the total number of requests.

For successes here, I'm not including the times a request was granted but I didn't act on it. There were 8 such transactions. For example, if a store agreed to give me $16 off a pendant and I never bought it, that's not money I actually saved. I'll use that success to look at how often people reward asking by industry and location, but I don't want that to enter into my calculation of how effective a saver I was. And in case you're wondering, it's only in the Saved category, and a difference of a few percentages -- nothing monumental!

Here are the success rates, more clearly:

At a quick glance, this suggests I had a much easier time getting something for nothing (Profit) than meeting any other financial objective. In the words of a linguistic genius I've never met, "WTF!!!!????"

2) What if we look at this in a different way?

Average gain per type of request shows how much I gained, spread across all attempts.

Once again, Profit stands out. This is because of one whopper of a gain, the airfare voucher, spread over relatively few attempts (36). Once again, Recouped is measly, and Was Owed is huge, suggesting my few efforts paid off -- as they should have. It was money that I should not have had to ask for in the first place.

Saved looks small here, especially give the scale. But the actual dollar value is surprisingly high. At least, I didn't expect to save an average of $13 per transaction every time I asked. That's factoring in the wins and the losses. In other words, just the habit of asking led to $13 back in my pocket, every time I tried. Sometimes I gained nothing, but sometimes I gained hundreds.


3) What does this mean? Is it better to pursue profits or savings?

In 365 days, I sought Profit 36 times and Savings 92 times.

But that's not because I felt Savings would lead to greater gains. Rather, because that's what I was already used to doing.

In fact, I frequently told myself to pursue profits, i.e. aim to maximize growth rather than minimize loss. But I kept returning to savings.

4) Why?

My focus on saving over profit says a lot about how I view money, and also where I stand financially. My whole adult life, I've been student, and the idea of stretching dollars is heavily inculcated. Don't get me wrong -- I definitely know how to indulge! But... even when something is a splurge, I tend to calculate if there's a way to cut costs. It's the grad student way, I suppose. Or the daughter of Eastern European immigrant way. Or simply the Roxy way?!

On the flipside to high savings are low profits: Since I don' t have a full time job, and grad school stipends in the humanities are non-negotiable (last I heard), I have very few opportunities for getting raises. The side work I do here and there has potential, but even those raises would only add up to so much. So the only profits, besides those rare raises, are about scoring freebies. (By the way, of course I could open a business or invest in the stock market, but that wouldn't be a "Profit" as I've defined it -- i.e. gaining cash or goods simply by asking.)

Considering Profit was quite lucrative per transaction (see graph above), and also that I earned the most in the Profit category (see graph from yesterday, below), this reinforces the idea that I should switch gears and focus on Profit.

At least, this year shows that seeking profits was a worthwhile enterprise.


Profit in this case is usually the equivalent of asking for a freebie. I did that with the voucher, and several other transactions where I tried to upgrade in some way. That's cool: once in a while, I asked for and snagged some lucrative treats. But is it a sustainable model?

I think not.

This brings me around to a final revelation for this post, which is really just a reinforcement of what I learned the day I opened Women Don't Ask, last July.

The first salary negotiation is do or die. The profits I need to be aiming for aren't those random but lucky wins -- though those are valuable, and I'm not discounting them. The one area I have some control over, and an area with big potential payoffs, is my future salary. So that's where I need to focus.

I mean, the graph says it all. Profit is the way to go.

The graph doesn't lie. The graph knows. Listen to the graph. Laugh at its silly jokes. Invite the graph to a blockbuster summer movie opening, but don't take its hand. Yet. Love the graph. Take the graph on walks, and tell it how great its hair looks after sex. Give the graph the bigger piece of cheesecake. Tell the graph you have bought adjoining cemetery plots and smile coyly it when it asks why. Surprise it with a trip to Alaska, then propose. Marry the graph. Move into a two bedroom condo with the graph, which has an office or space for "whatever." Mention, on a sunny Saturday morning, that you've subscribed to Cookie and you have an announcement. Go on an impromptu road trip with the graph, get out of gas in the middle of Iowa and, while waiting for AAA to show up in a field of soybeans, talk about the things you might have done if you weren't doing this. Dream together. Have kids with the graph. Come home exhausted one day and find the graph asleep in bed with the younguns, and wake it up just to say you love it more than your children. Admit you had been watching the graph from across the street since you were both 8. Admit you've saved scraps of its DNA for potential cloning projects. When the graph mentions the words restraining order, hug it and rock it gently.

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