A lot of folks are talking about stocking up on the Forever Stamp before postal rates change later this spring.
The stamp, which features the Liberty Bell on it, will always cover the cost of mailing one ounce of mail in the United States, regardless of what you paid for it. So if you buy a Forever Stamp today at a cost of 41 cents, it will still work for mailing a letter years from now when postage is 79 cents per ounce. The idea is to eliminate the hassle of those 1 and 2-cent stamps you need every time the postal rate changes.
I won't be stockpiling Forever Stamps. I mean, I may stash away one book, just... well, because. But I won't be spending my tax refund on them, that's for sure.
Here's why: Since 1978, the postage rate has increased only 2.8 percent. This works out to a price increase of about .14 percent each year. Even if you put your money in a plain ordinary savings account, you will probably average 2 percent a year... put that same money in a good, growth mutual fund and you could be averaging a 7 percent increase or more.
You are better off saving your money than to sock it away in stamps. Your money will be relatively safe in a savings or money market account, whereas the stamps could get lost, stolen or destroyed before you can use them.
Another reason to forgo stockpiling Forever Stamps involves the ever-changing technology world. More and more companies are encouraging people to sign up for online bill pay. Most banks have an online banking option, too. I know that I save approximately $30 each year using the internet instead of stamps to pay bills and complete transactions. This is a trend I expect to see continue, especially as postage rates increase and people seek to conserve our resources.
I know that somewhere there is a guy out there with 500 books of Forever Stamps in a fire-proof box just waiting to make his fortune on Ebay some day.
But I think I'll stick with the good ol' savings. It just makes more cents.
Monday, April 7, 2008
Sticking to savings, not stamps
7 comments:
i was totally wondering about this. thanks for the thoughtful insight!
Glad you liked it! It's just been something I've been thinking about lately.
We have a Permanent stamp in Canada that works the same way and that was my logic too. I like to have a few on hand and may buy a book before rates increase, but not a roll of 100 that'd take me 5 years to go through.
Unless of course the rates were to double or something, but I doubt that.
Thanks for sharing your perspective, Canadian Saver! It's nice to know that my thinking isn't totally out of whack!
Thanks for doing the math! While it might be tempting to stock up on the stamps, there's no guarantee they'll continue to be accepted year after year. The federal government has a habit of changing the rules of the game every few years!
I actually have posted about buying the Forever Stamp and I recently bought some to get them before the price increase.
However, I think it is a matter of perspective. I saw it as an opportunity to save some money on something I actually use, not as a long-term savings plan. Although we do pay all of our bills online (except the water bill, which is paid in person), we still send out birthday cards to a large family, hand-written thank you notes (which I insist on), and other thoughtful cards for people who need prayer or support or a new copy of a photo of our son. =)
Certainly if it takes 5 years to use 100 stamps, this is a waste of your money in the moment. However, if I use the 200 I bought over the next year, I think I have done okay (and I'm not stuck without a stamp with the closest post office almost 5 miles away!).
Thanks for the perspective though.
You make a good point, Mrs Nespy... I personally don't use enough stamps each year for it to be a real savings for me, but I can see how it could be if you had a lot of mailing to do. Thanks for sharing your thoughts.
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