You've already worked through the Impulse Buying tab, right? Good. On this page we're talking about the biggest impulse-buying "trap," buying things we want rather than things we need.
Do you do that much? Let's see.
A look at the money your gullible decisions will probably cost you in the years ahead.
The easiest money you'll ever make! Recognizing the four gullibility traps and building habits to stay out of those traps can change your financial future.
Read the "Wants vs. Needs" story.
How we derived the total costs for all four of the gullibility traps? Read our rationale.
Don't believe us when we say you'll spend more when you charge rather than pay cash?
Take this! Here are a few reasons why, taken from "Life Science" articles.
The main reason why you spend less when you pay cash? You probably already know this in your gut: "Consumers simply feel the pain more when they part with cash," the researchers write in an issue of Journal of Experimental Psychology: Applied.
There are two times not to shop. You know one: when you're hungry. But Life Science tells us about another study in Psychological Science which says shopping when you're blue is also an expensive habit. Hey, wait a minute. Didn't you already know that instinctively, too?
Do you like really quick tips you can use without thinking much? "50 of the Best Tips We've Ever Heard" is from Consumer Reports, what we consider to be the Gold Standard of objective consumer information. CR isn't always right, but it is always trying to be right. This article has great "nuggets" like these:
Uncover every possible discount. For instance, have you asked your auto and home insurance providers if you're getting every discount? Would raising your deductible make sense?
Always ask for a price break. (Ever tried that with a medical bill?)
Skip extended warranties. CR says electronics and appliances "rarely break within the warranty period," and if they do, repairs, on average are usually about the same as the cost of an extended warranty.
Read the full article on Consumer Reports.
Want to understand how advertising and "branding" of products or services impact us?
Here's a lesson from the Education Portal that briefly explains from a marketing point of view what's going on as you consciously and unconsciously make buying decisions. This simple site can help you avoid most of the pitfalls of gullibility shopping and learn how to make more thoughtful buying decisions. It covers topics like these:
Work through the Study.com website.
Want to know more about why we make a "Want" decision rather than a "Need" decision?
Here's a great Q and A with two Harvard professors that's filled with insights and unexpected conclusions like these:
Planning next week's grocery bill today might save you money next week, and also make you a healthier eater.
You're more likely to return a documentary rental late than an action film.
Read the brief Q and A.
Even "The Capitalist Tool" finds "wants vs. needs" a worthy topic!
Here's a funny look at a Forbes Magazine contributor's day in dealing with the realities of her wants and needs. You'll probably recognize yourself here. The contributor is Variny Paladino. Excerpts:
6:30 AM - The alarm goes off, and my seven-year old son's face is about an inch away from mine. He says to me, "Mommy, you need to brush your teeth. I want you to make me chocolate pancakes for breakfast."
5:30 PM - The car needs gas. It costs almost $4 a gallon. I want to start using my roller blades as a less pricey alternative for transportation.
8:00 PM - The kids need to take a bath, and my son wants me to pay him $2 to do so. I appreciate his entrepreneurial spirit, but diminish his hopes of ever making money by trying to negotiate bath time with an over-tired mother. We nip that conversation in the bud.
Read more on the Forbes Magazine website.
Many car buyers spent as much as several thousand dollars more than they needed to on a new—or newer—set of wheels. Why? They fell into one or more of five common traps in the car buying process that I'm going to show you how to avoid.
In this report, we examine which popular features may provide useful tools and which may be gimmicks to entice you to run a balance on a card and thus provide more profit to the card issuer.
Prepaid debit cards also have significant drawbacks—they are typically loaded with fees and do not have the protection of consumer laws that apply to traditional checking account debit cards and credit cards.
If you are in the market for a new mortgage or a refinance of your current mortgage, what do you need to know to make the best decision for your circumstances? Some tips to help you review options and determine the answers right for you.
Find out how we derived the total costs for all four of the gullibility traps. Read our rationale.
FoolProof's financial education tools are the only financial education tools in the United States endorsed by both the Consumer Federation of America and the National Association of Consumer Advocates.
None of the programs contain advertising, and all of them advocate for you—not for any business.
Why not check it out?
Head to our main consumer information portal: www.foolproofme.com
Or, take the next test: "Advertising"
