Americans Are Going Generic

Welcome back readers. I'm slowly getting the site back, but let's talk personal finance. It took a recession, but Americans appear to becoming more generic consumers:

Many Americans are changing their everyday purchases and abandoning brand loyalty, prompted by the persistent financial pressure of rising food, gasoline and electricity prices.

It didn't seem like it was too far off. Most consumers don't buy brand-name basics like butter, milk, and eggs. But consumers appear to be branching out into private-label brands over their national counterparts, and not just on basic items like milk, eggs, and butter:

From coloring hair at home instead of at the salon to trying cheaper laundry detergents, new evidence indicates that Americans are modifying even minor household habits to save money.

I get to see the result of these consumer decisions while working for a consumer-products company. But even outside of the private-label and store-brand products, consumers are eating out less, buying fewer prepared foods, and stretching our cleaning products.



These small-ticket, everyday purchases can secretly eat into your budget before you realize it. If the price of your cleaner increases 30 cents, milk goes up 50 cents, cereal goes up 50 cents, butter goes up 40 cents, and so on, you'll easily find yourself spending $20-$30 more per month than you realize. I remember when I first moved to New York I could buy 2 movie tickets for $17. Now they are $22. All these little costs add up, leaving you wondering where the money went.



The lingering question many of you may ask is whether the private-label substitutes are of the same quality despite their significantly lower costs. In many cases, the answer is yes! Note how private-label manufacturers are printing "Compare to XXXX Brand" on the package while placing their products right next to the national leader. The ingredients are very often the same—except they don't have to pass advertising costs on to you.



But as I always encourage you to do with these product types, try them out on a case-by-case basis. Some will be better than others—you may even find yourself converted (as I have with many products). You'll save yourself a bundle—that you can use to close holes in your budget and invest in this fire sale going on in the stock market right now.