Tuesday, July 15, 2008

My .02 Cents

I couldn’t have picked a more ironic title if I tried. As fate would have it, .02 cents was the exact amount that the cashier at the Food Pantry overlooked as she rang up my lactose free milk at $4.92 + tax, totaling $5.02 (the tax and price of milk in this instance is another blog altogether). Part of me saw her act as sincere as she handed me back the additional dollar and just accepted the $5 bill. The more analytical and cautious side of me resented her act of kindness and wanted to discourage the practice. Not only did I worry that she might be in trouble for not keeping a balanced register at the end of the night by forgetting to pony up the .02 cents but I also cringed at the idea that she along with millions were de-emphasizing the value of our currency.

I’ll concede the absolute fact that .02 or any denomination under the not-so-precious nickel doesn’t get you much these days by itself. Gone are the days of penny arcades and candy. But since when did money become so insignificant that we completely act as if the most plentiful of tender does not exist? With all of the concern of the economy spiraling downward, it’s sort of refreshing to know that at least my cashier isn’t too concerned about “pinching pennies.”

I get my frugalness from my parents. My entire childhood went virtually without name brands. Coke, Pepsi, Sprite, Mountain Dew were non-existent in my house. The household names in the Carroll refrigerator were Twist-up, Mountain Lightning, Dr. Thunder and my favorite of generic labels, “Cola.” And these were just the names of soft drinks that we purchased, I would go into detail about the rest of the items on our grocery list, except I’d just be prefacing every item with “Shaw’s.” And after the many years that my family cut coupons, denied me the .25 cent gumball at the store and ignored the pop marketing ads on TV, I can reasonably say that I don’t believe I missed out on anything spectacular.

In the grand scheme of our checkbooks, I suppose one cent isn’t that important. As humans we tend to be drawn to neat patterns and whole numbers. Whether we’re tipping the waiter at the restaurant or doing groceries, we inevitably round. But when we round for the worst, the aggregate can add up. When gas was $2.50 a gallon we weren’t alarmed. It spiked to $2.80 and still we didn’t seem to be up in arms. $2.82, 2.84. 2.86, 2.88, 2.90, 2.92 and the prices kept soaring to the national average of $4.00 that we see today. Tomorrow it might be $4.02 but how much angrier could we get? We’re just talking pennies right? Pennies that is, that added up and over the course of a year have us wondering what brought about such high gas prices?

Let us for a minute forget about supply and demand, speculation, the wars in the Middle east and just look at things from purely an economic standpoint where everybody from the supplier, manufacturer and gas companies at the pump out of reaction to higher prices all added .02 to their prices all along the chain until it ultimately got passed down to us the consumers. .02 cents multiplied many times over results in unhappy customers and high gas prices. This type of consumer behavior goes beyond butterfly effect theory. It equates to simply mathematics. When millions of people treat each cent as a “throw-away,” over many more millions of purchases, we can rightly assume that money is not being exchanged and in fact taken out of the marketplace.

Maybe one of the reasons why our pennies don’t do anything for us anymore, is because we simply don’t let them. We throw them into a used coffee can, never to redeem them or throw them into a well with a wish. In my 25 years of existence, I have never seen those pennies miraculously turn into dollars. All I ever see is poor people down on their luck and with a penny less. If we only acted as if every penny was valuable then maybe we would value more that was around us. In ten years who knows if inflation will be bad and if we treat the dollar the same as the penny? The way we so nonchalantly spend our money without paying the slightest attention to detail for every cent accounted for, there’s no wonder that governmental spending abuse happens and slips under our nose beyond our knowledge. It might be a stretch to assume that all of our economic woes revert back to a single copper coin but who says it ends there?

I just wish we’d look around and see that some people in this world live off less than a $1 a day. To them, a single penny means a lot to them and adds up in the course of their lifetime. Who are we to just throw it away along with the remainder of our dinner that we don’t want to bother to make leftovers out of.

When it comes to savings and economic advice, I’ll revert back to an old but classic quote. “A penny saved, is a penny earned.”

And these are my .02 cents.

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