That’s $900 off! Twisting Language in the Stores of America

Have you ever looked at advertisements carefully? Next time you do… look carefully at the wording, and how they twist common words and phrases that play with your ideas. Amazon is by no means unique in this respect. Let’s take a classic example:

save money on lcd tv

You’ll notice in the ad how we are encouraged to ‘save money’. That’s a great idea! But how? By buying their product! We’ll save over $900.00 (that’s 31%) of the total. That’s impressive.

 

Now let’s look at the meaning of the words “Save” or “Save $900”! But for the savvy shopper, these are warning signs about how companies play with common meanings of words to highlight their own products, appeal to our emotions and encourage us to open our wallets…

There are a number of meanings that we need to note:

Meaning #1: to put aside as a store or reserve

Naturally, this indicates that we are putting money away somewhere, somehow in a store. In the modern world, stores would include a bank, a broker (perhaps), ETFs… any of a hundred ways. The actual meaning of the word ‘reserve’ means to keep something for a particular purpose or for future need.

Money is defined by Merriam Webster’s as “…a medium of exchange, a measure of value, or a means of payment”. So the term saving money means “putting away something of value for another reason or for future use”.

There are lots of typical examples of ‘saving money’: a single man saves money for his new car, a couple save money for a deposit on a house, an older woman saves money for retirement, … whatever. The idea is that when you save money you are delaying gratification of your purchase of items that would be bring you present comfort, joy and possession. Such gratification may be increased later by purchasing a new car or retiring in comfort to Tuscany.

Meaning #2: to save money on a deal or special offer

Like the advertisement said, you could buy and save at the same time. How? You buy a brand new LCD TV for your living room AND you would save an extra $900 on the purchase price. Let’s forget about price competition, product rotation, and such like…

The term “save money” here simply means to spend less money than previously or than elsewhere. We’re all accustomed to this idea of saving money!

If you buy this LCD TV, are you really saving money?

No, of course not. You are simply spending less than you would otherwise have had to spend.

  • For some people, this may be an added bonus (unlikely) since they may well simply spend the extra $900 on a bigger screen size, a more expensive buy-and-save offer, or lots of extra cables and doo-dahs.
  • For others, this means that they would buy this model rather than a smaller one because the extra $900 brings the TV inside their budget.
  • Still others would simply finance the whole deal, forget about the $900 and worry about how to make the monthly minimum payments on a loan purchase agreement, consolidated loan or credit card. They would likely end up spending more than $250-500 over two years in additional interest payments (based on 13% and 21% financing).

What each of them would likely fail to take into account is that in saving money on the purchase price, they are still spending a whole bunch of money that could be otherwise saved and put in a future store. Of course, the advertisement wants you to spend your money on that item. That’s good for the company selling the item and the company that makes the item. It may not necessarily be good for you.

 

By playing with the language, these companies will try to confuse you by encouraging you to spend while saving despite the fact that it is impossible. You may delight yourself in this fantasy for a while, but when you open your credit card statement, you WILL know the truth: that LCD TV still cost nearly $2,000; and that money must come from SOMEWHERE.

But is it legal?

This is not the only instance where companies will play with language to confuse, befuddle or intimidate the customer. Some of the tricks that they use are legal, some may be gray, and some will be illegal. Whatever the nature of the legality, it is always in your interest to put your interests first, because the advertisers CERTAINLY won’t. Whatever they claim in their commercials or advertisements.

save money on amazon

Such tricks may include: time-limited offers, only x in stock, best value in town or the difference back, seasonal sales, … the list goes on and on. Whatever: we live in a world of abundance, and esp. in tech items, the next generation will ALWAYS be more powerful, less expensive, smaller, lighter and more desirable. In less technologically related areas, you will always be able to buy more towels at great prices, or shoes at 50%… why? Because next season there’s another sale. There’s always going to be another sale.

With sales revenue down in most stores, more people trading down, and customers leaning towards more economical purchasing, stores are going to become more aggressive in their sales tactics, pricing strategies and marketing campaigns. Since wallets are tighter with increasing mortgage payments, skyrocketing fuel and food costs, and increasing weakness in the economy, shoppers may increasingly find themselves vulnerable to smarter strategies in the markets, supermarkets, malls and department stores of America.

Have you seen advertisements that tempt customers to spend by creating confusing slogans? I always remember the “buy now! pay later” ads that were common when I was growing up in the UK. Who cares when you have to pay, YOU STILL have to pay?…

My own sales pitch – Two for the price of one!

So, share some of the more egregious examples here! Come on, you know you want to… oh, and for each comment on this blog, I’ll comment in this thread and follow you to your blog and comment there, too! And that’s a promise! What are you waiting for? Comment today, comment tomorrow, but COMMENT!

Buying a house: saving for the deposit? It does have advantages…!

With the advent of 100%+ mortgages, borrowers these days find it easy to borrow the money they need to buy the house they want. It didn’t always use to be that way. In fact, up until the recent credit boom, borrowers were required to pay a deposit on the house from their own savings. In fact, in Taiwan, it is still this way. For new houses and pre-construction units, the deposit is actually between 10%-20%, but for second hand units, it is typically 30%-40% of the sale price.

When my wife and I first married, saving any kind of deposit was quite difficult, because we were starting from nothing. We had nothing in the bank after our wedding; so purchasing any property was simply out of the question. If we had been living in the UK or US, it would have been quite simple to go out and borrow the money for our house, our furnishings, and everything else we needed for the house.

Looking back, though, I realized that the fiscal discipline that we learned from saving for the deposit taught us much more about how (dare I say NOT) to manage our cash, cash flow, savings and credit cards. So, today when I was chatting with my good friend, Cindy, about buying a house. She had just moved into her own apartment, and was dreaming about buying a house. But it’s difficult when you are starting out to save money, because even renting a house requires quite a bit of cash.

After I got home, I realized that it was having to save for the deposit that helped us to manage our cash flow much better. It took us over 5 years to save up enough for a house, but we did it! And, at the beginning of the five years, only my wife had a proper job!

So why? Simply, because if you can save a cash deposit, then you have learned a number of important skills for a house-holder:

  1. you can manage your income/expenses carefully;
  2. you have budgeted properly;
  3. you have consistently saved up money;
  4. you know that it’s possible to manage your money without spending it all; and,
  5. by committing your own money to your house, you are making an emotional commitment that having a 100% mortgage may not allow because you are risking your OWN money.

Together, these qualities are more than enough to prepare your for the task of buying and managing your own house. More importantly, with these skills, you are setting your stage for managing your finances for the rest of your life (God willing!).

In addition, when you do purchase your house, you will have a ton of advantages that you didn’t reckon on in the first place:

  1. lower overall mortgage rate than 100% mortgage;
  2. lower overall mortgage payments vis-a-vis if you had paid for the house in a 100% mortage!
  3. a better credit record because you’re not overleveraged;
  4. you’re not overleveraged;
  5. in a tough seller’s market, you’ll have some more ‘protection’ against negative equity situations;
  6. you may even be able to use the savings habit to pay off your entire mortage much sooner saving a lot of interest payments over the term of your mortgage!

So, if you are forced by circumstances to save for a deposit for your house, look on it as an opportunity not a burden! We learned a lot… Seize the chance to save! No matter how hard it is for you to cut back, it will be worth it in the end.

Did you have to save for a deposit for your first house? How much was it? Was it difficult or easy for you to get it together? I’d love to hear how you

Tri-Cities Real Estate: buying and selling great houses

tricities

In early April, Colleen Lane contacted me and asked to me to review the Tri-Cities Real Estate website, which you can see at the top of the blog, and in the sidebar.

After visiting such a beautifully crafted website, rich in visual media, careful coloring, and pleasing welcome page, I have to say that this website is perhaps the most visually attractive website that I’ve had to review, and I believe it surely reflects the natural beauty of its home state.

Tri-Cities Real Estate, based in Washington State (one of the loveliest states with its low population density, extensive reservations and wonderful scenery), provides Real Estate services in Kennewick, Pasco, and Richland.

I like the URL which is simple and easy to remember. The only problem with the URL is it doesn’t tell you what the website is… but then you likely already know when you visit it. Theirblog is updated regularly, but uses a different theme, so it looks out of character with the rest of the website.

resources

One of the reasons a book like “Rich Dad Poor Dad” has succeeded is by personalizing the story, by creating characters, and events, and narrating the story. People are drawn to a story, rather than to cold, dry facts, lists and explanations; it would be nice if this website could play up this angle of the ‘story’ and show us how Tri-Cities Real Estate really does make a difference in the life of its customers! That would help to show their customers how they actually solve problems.

As a resource, the website is literally stuffed with articles on ALL aspects of moving house, including fixer-uppers, real estate lawyers, and even Debt Ratios. You could spend quite some time just reading around the articles. In fact, all the content is unique as well, and there are some interesting things to play with such as the Google Locator Map, and the search function which had me searching for a lot of nice houses in my (ideal) price range. So joelaneColleen, do you have any good property for a British expat with not much cash?! Well, I found that there are quite a few bungalows (single floor houses), which would appeal to my wife. Why don’t you head on over and check out the fine houses of Washington State. I was also surprised to find that Kennewick’s sister city is YingKo, Taiwan. It’s like a stone’s throw from my wife’s home, and is the home of pottery in Taiwan.

So search away on their website, you can search and register for looking at properties on their website easily and quickly using their search engine. The images, information and website are all responsive and tidy, making it easy to thumb through many properties in your price range. Since their servers are quick, you’ll find it a pleasure, not a drag.

So if you are thinking of Washington State as a place to move to, check out the real estate first, courtesy of Long Term Capital Growth !

Sponsored by Tri-Cities Real Estate.