I’m stuck on you (or, More Fun With Numbers)

I’ll make this easy for you so you can stop reading here: USA stamps increase on Sunday. Buy more NOW.

Many missionaries who read this probably send a lot of letters. Some use newsletter services and many are migrating to more electronic communiqués, but even so—compared to most people—it’s my guess that the average reader of this blog uses substantially more stamps than anyone else they know not in ministry.

Part 1: A little rate increase history

ALERT: The U.S. Postal Service on Sunday, July 10th will do their next periodic first-class rate increase, from 58¢ to 60¢ (a 3.4% increase).

This shouldn’t be news to you, nor particularly concerning: U.S. postal rates do increase from time-to-time, but they have stayed very close to inflation rates.

I first started sending my “family newsletter” when I was 9 years old (1977) and remember stamps being 13¢ at the time. Adjusted for inflation, that 13¢ is worth 66¢ today, so in some respects today’s prices are comparatively lower than before. As a penny becomes less valuable each year, it is easier for the postal service to stay close to inflation. In 1932, the first increase in 47 years was from 2¢ to 3¢, a staggering 50% jump that must have been very painful for many during the peak of the Depression.

That 1932 increase was the only permanent increase between 1885 and 1958 (73 years!) when it finally jumped a penny again from 3¢ to 4¢… but that time it was only a 33% increase (wink). Since then, prices have increased sporadically in both time and amount, from as quickly as three months to several four-year breaks and from 1¢ to 5¢ each time. Until recently, Congress often didn’t approve the amount of the increase until the last minute so the postal service couldn’t print billions of new stamps in advance. As a result, everyone had to buy sheets of 1¢ or 2¢ stamps to combine with their existing pile of stamps, or until the postal service could print the new stamps. Painful. I felt sorry for the postal clerks selling billions of sheets of penny stamps.

The invention of the Forever stamp in 2006 (Canada) and 2007 (USA) was a real game changer. It made life easier for everyone, and of course self-stick stamps—originally derided by purists—are both wonderful and now the only stamps available. The fears of people stockpiling huge stamps in advance was never realized, and the savings from not re-printing and/or destroying billions of stamps far outweighed the lost revenue from stamps being used at a former rate. One time in Canada (in 2013) the single stamp price increased 58%; CanadaPost stopped selling Forever stamps the day the rate increase was announced and resumed after the new rate came into effect months later.

Part 2: The Math of Buying Stamps in Advance

The beauty of the forever stamp goes beyond just making life easier for us all. It actually gives us an opportunity to hedge against inflation! The largest face-value jump in USA history occurred on January 27, 2019, when prices went up a whopping 5¢ (a 10% increase).

Thanks to the powerful history engine of TntConnect, I see that over the past seven years I have averaged 104 letters per month. If stamps are going up 2¢ this week, buying six months’ worth of stamps today instead of Monday will save $12.48.

ALERT: The USPS is trying something new by pre-planning rate increases every six months for the next 10 years, with the actual increase being announced one year in advance.

Since rates will go up at least an additional 2¢ at that time, buying 12 months’ today saves a minimum of $37.44.

Over the years as I have had this same conversation with people, some financially astute folks suggest that the long-term gain is diminished because those funds could be invested at a rate greater than inflation. That would be true if I was using personal funds, but these are non-taxed, non-personal funds, so the net savings is only against future partnership development costs. I will either be reimbursing these funds in one big block now, or in smaller chunks every few months over the next X years.

The value equation increases on a fairly straight line into the future, so buying ten years’ saves a minimum of $2620 but likely hundreds more because the long-term increases could be 3¢ or 4¢ each time, especially if this current inflationary period continues for a while.

Will I actually purchase 60 or 120 months’ worth of stamps? Probably not. However, in 2019 with 7¢ in rate increases over the year I did buy 36 months’ worth of stamps and I’m down to my last 100. So it’s not just theory for me.

The only real downside of purchasing stamps so far in advance is that I do not get to purchase some of the new designs that will come out between now and my next purchases. Given that the average recipient gets exactly one stamp on a letter, and that very few people send any first class mail at all, I doubt anyone but me would notice that!

If by some chance I should leave the mission field, I’m sure I could find some willing friend to acquire stamps at a discount!

Part 3: Other Rate Increases

ALERT: Postcard and ‘second-ounce’ stamps are increasing 10% and 20% respectively.

You may occasionally send postcards or include inserts that make your letters more than one ounce. You should know about these greater increases. From left, above, on Sunday:

  • Postcard stamps will increase from 40¢ to 44¢ (10%)
  • Additional ounce stamps will increase from 20¢ to 24¢ (20%), which means the…
  • Two-ounce stamp will increase from 78¢ to 84¢ (7.6%)
  • International (or “Global”) stamps will increase from $1.30 to $1.40 (7.6%)

Part 4: Take Action Now

If you are in the USA, you can take advantage of this opportunity right now. Buy stamps online and they ship quickly for a very low flat rate no matter how much you buy. Be warned, though: Some of the forever stamps are dated after Sunday, so they are already selling for 60¢. Be sure to buy the correct stamps!

Part 5: The Sad Story

My father was an avid stamp collector and had an almost-complete collection of all first day of issue stamps in Canada from 1884 on. After he died, a young niece indicated an interest in the collection and we all agreed she could have it, but that we wanted to wait until she was a little older. The following year the entire collection was lost when my brother’s apartment in Iowa was buried in a flood.

Part 6, Wrapping it up: Two of my favorite stamps from all time (among many):

The 1998 CanadaPost stamp celebrating 125 years of the Royal Canadian Mounted Police:

The 2020 stamp celebrating the 400th anniversary of the Mayflower crossing. I was teaching U.S. History to our homeschool co-op and taught on the Mayflower the same week that stamp was released.

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