This story is free to read because readers choose to support LAist. If you find value in independent local reporting, make a donation to power our newsroom today.
This is an archival story that predates current editorial management.
This archival content was written, edited, and published prior to LAist's acquisition by its current owner, Southern California Public Radio ("SCPR"). Content, such as language choice and subject matter, in archival articles therefore may not align with SCPR's current editorial standards. To learn more about those standards and why we make this distinction, please click here.
Should We Be Stockpiling Forever Stamps?
The US Postal Service this week implemented their newly inflated rates, again. And to distract us from the fact that the government agency is sticking it to us despite continuing making hundreds of millions of dollars in profit, they rolled out the new Forever Stamp.
The Forever Stamp allows you to buy a 41-cent stamp today and use it for a regular letter, like, say, a nice card to your favorite city-based blog with a check enclosed made out to Cash, and mail it in the future even if the rate is no longer 41 cents.
What this does, in effect is kill the 1- and 2-cent add-on stamps, like the one we just had to go get at the post office now that the rate is no longer 39 cents to mail our rent check across town.
So the question is, should we be stocking up on these new 41-cent stamps before the next series of increases hit?
Nathaniel Rich of Slate says hells no:
Absolutely not. Since 1971, postal rates have increased more slowly than the actual inflation rate, as measured by the U.S. Consumer Price Index. So, despite the numerous rate hikes over the last 36 years, stamps have actually been getting cheaper. The 20-cent stamp from 1981, for instance, would be equivalent to 45 cents in today's dollars—which makes today's rate 10 percent cheaper than it was 26 years ago. Should this historical pattern hold, you'd be paying more for today's forever stamps than you would for any stamp in the future, no matter how high the rate goes.
Sponsored message
Terrance Odean, a professor at the University of California at Berkeley who specializes in behavioral finance, doesn't think much of Forever Stamps as a financial play. You can't buy enough of them to make any serious money, he says, and you can't sell them at a profit. However, Odean says, "There is some psychological benefit you feel if you think you're being clever and getting a good deal." But then, he hastens to add, "You'll feel less than clever if you're the last person left using postage stamps to mail in your utility bills when everyone else is paying them online, postage-free." Killjoy.
The bottom line: Unless you time your purchases right, Forever Stamps aren't a good financial speculation. But you can't lose money, either -- you can always use them to mail letters.
You come to LAist because you want independent reporting and trustworthy local information. Our newsroom doesn’t answer to shareholders looking to turn a profit. Instead, we answer to you and our connected community. We are free to tell the full truth, to hold power to account without fear or favor, and to follow facts wherever they lead. Our only loyalty is to our audiences and our mission: to inform, engage, and strengthen our community.
Right now, LAist has lost $1.7M in annual funding due to Congress clawing back money already approved. The support we receive from readers like you will determine how fully our newsroom can continue informing, serving, and strengthening Southern California.
If this story helped you today, please become a monthly member today to help sustain this mission. It just takes 1 minute to donate below.
Your tax-deductible donation keeps LAist independent and accessible to everyone.
Right now, LAist has lost $1.7M in annual funding due to Congress clawing back money already approved. The support we receive from readers like you will determine how fully our newsroom can continue informing, serving, and strengthening Southern California.
If this story helped you today, please become a monthly member today to help sustain this mission. It just takes 1 minute to donate below.
Your tax-deductible donation keeps LAist independent and accessible to everyone.
Senior Vice President News, Editor in Chief
