Never before in the history of mankind has such sophistication and effort gone in to taking your money. Companies are spending billions of dollars figuring out exactly how you think, how you act, and how to dial in your preferences so that you will buy their products. The end result is that many people spend large amounts of their time trying to figure out how to spend the little bit of money that they earn. Some people do this with an obsession. Even before they have earned the money, they have spent it on things that they have been convinced they NEED. (notice I didn’t say want. In mild cases, they have consciously decided that they want something, but in many cases the marketing was so good that they believe they need it.)
We spend more of our money every day on eating out than we ever have in the history of mankind. (hunting and gathering, as they did many centuries ago does not count as eating out). 25% of all retail establishments in the U.S are for eating and drinking. There are more than 650000 restaurants in the U.S.. Americans eat almost 30% of their meals away from home each year. In 1996, Americans spent 44% of their food dollars eating out. Not only are we spending a lot of our money eating out, we are also filling ourselves too full with what is served. Restaurants, on average, always serve up at least double what you should eat on a plate. All is not lost. Use the same discipline that you apply to your finances and save half for later. You can average down the cost of each meal by doing this.
I’ve said it before. I’m guilty of being sucked in to the electronic marketing grinder. I have far too many electronics in my home. I’m embarrassed to even tell you what the computer to user ratio is in my house. I use the defense that it’s what I do for a living, and is helping me use PC’s to improve my skill set. It’s just an excuse.
Open up the Sunday paper and count how many ads there are for electronics. In a quick scan of my latest paper I found:
Dell (Apparently they are trying to increase traffic to their site)
Magnolia Hifi and Video
8 different companies all trying to sell me electronics. Some used cartoons in their ads, some embedded the latest movie images on the screens of the electronics in a cross branding effort. None of them sparked anything in me and caused me to go down to the store. I did enjoy dreaming about buying a few things thoughâ€¦..
Many people will tell you that you can’t go wrong dumping money in to your house. I tend to agree and disagree. Targeted improvements have been shown to increase the value of your house. Kitchens and bathrooms are the best places to make improvements. I’ve found that simple inexpensive improvements can make a world of difference. For those people that are doing large improvements to their homes, it’s important to survey the neighborhood and make sure that you don’t â€œover improveâ€ your house. It’s not hard to invest more money in your home than you could sell it for. Your house isn’t the only thing that is involved when calculating the true market value of your home. The neighborhood you are in (think location, location, location) also impacts it tremendously. What are other houses in your neighborhood selling for?
Who is contributing to your desire to invest in your house? Well, the do it yourself improvement stores certainly aren’t trying to talk you out of it. I only found 3 ads in the Sunday paper that were trying to get me to buy things for the house. But there are others that would like to see you invest in your house. Banks are always sending me mail telling me that there has never been a better time to pull equity out of my house to fix it up. I continually get flyers in the mail from lots of different local contractors for just about any service you can imagine. I estimate that I get no less than 4 roofing flyers, 2 home heating duct vent cleaning, 3 carpet cleaning flyers, 4 house painting flyers (it’s Summer), 1 siding contractor flyer, and 2 air conditioning flyers each month.
What can I do:
To protect myself from all of this marketing, I try to consciously seek out something when I want to buy it, rather than sit back and wait to be convinced by someone who wants my money. My general rule is to seek out at least 3 options on any major purchase to be sure that I find the best possible price. To get a sense of whether it’s a good deal, I also check to see if there is one for sale on Ebay, and about what I expect the final price on the auction will be. (Or I wait for the auction to end). My point is that I try not to let someone tell me what I should buy, but rather make the decision to buy something myself.
The only problem with my plan is that they are getting in my head. I’m sure of it. As proof of this, just ask me how the theme song goes for a particular product. I’ll bet I know the tune.