Friday, April 8, 2011

I always get a deal

Awhile ago I was talking to The Shopper about buying things and money.  He was shocked at just how little money my family lives on and simply couldn't fathom how we could make it on roughly 27k a year.  Not to mention that I think we pretty much live a life of endless riches, a life fit for royalty.  His income is higher than ours by several times and many of the major costs in his life were similar to ours and yet he was not accumulating money.  He mentioned, however, that he was a very canny shopper and always got a deal when he bought things.  That line triggers a question in my mind.

"Do you get a deal when you go out to buy something you need, or do you buy things just because they are a deal?"

That question is critical and it turns out it was the right one to ask.  He divulged that he would only buy things that were 50% off but that whenever he saw things he thought he might use that were discounted by that magical % he would buy them.  New clothes, music, electronics, whatever, when he saw a deal he would take it and felt like that made him a smart shopper and good with money.  It is funny that when I see that strategy I pretty much reverse it and call it disastrous with money and an uninformed shopper.  This rests on the fundamental facts that 'regular price' is an illusion created by merchants to fleece people with exactly this mindset and that the benefit of a thing has very little to do with its price, regular or discounted, and everything to do with how much it will actually improve the buyer's life.  If I go to buy a pair of shoes it is because my last pair of shoes is actually broken and nonfunctional since more shoes would actually be worse due to needing more closet space.  I have thousands of songs in itunes and I hardly ever listen to most of them so buying more simply isn't going to benefit me.  I could just go back and actually listen to all the ones I haven't heard in a year instead.

I think everyone should work in a store where the salespeople have total price control if only for a short while.  It gives such clarity when you are confronted with a poster advertising a big sale or a gigantic % discount, particularly after you hear the stories told by the old salespeople of the crazy companies where they used to work *cough* cheat customers *cough*.  That idea that the price currently offered is somehow exceptional simply does enter into my mind anymore after my time in retail; I can get the best price any time.  I tried to convince The Shopper that he should utterly ignore 50% off and simply get the best price for whatever he knows he absolutely needs.  Unfortunately I think my advice fell on deaf ears - even though nearly all discounts are entirely fictional he continued to believe he was finding exceptional deals every time.  I expect that giving up the idea that 'regular price' is actually the regular price is something like giving up religion in that you can tell people how things really are all you like but until they have it personally slammed in their faces they are likely to go on believing what they have always believed.

It probably helps that I like to spend my time sitting at home reading and writing on the computer.  I don't see ads on TV, I don't get exposure to billboards or even subway advertising mostly.  I also hang around with a lot of people who think owning stuff (except for real estate and a bitchin' computer) is unimportant.  I know that I might be tempted to buy things when walking through the mall during Boxing Week Blowout! but surely other people can see that if every single store has 70% off every single item that *nobody* is getting a deal?


  1. I just bought some clothing at The Trading Post in GM and it suddenly occurred to me that I should think about all clothes like an economist.

    If a sweater costs $120 and I end up wearing it 120 times before it is worn out (or I'm just not happy with the appearance anymore) then it costs me $1 every time I put on that article of clothing. Adding up all of the items that I'm wearing by this method could give me a varying daily cost of dressing myself.

    Since I mostly dress like a dirt bag let's try this exercise with my work outfit.

    T-shirt: Cost $10 for 3 pack. Worn it several hundred times. Let's say $0.01 per wear.

    Dress shirt: Cost $60. Worn for 2 years, about once a week? (88 times). That’s $0.68 per wear.

    Dress pants: $55. Worn for 3 years, about 2-3 times per week. $0.17 per wear.

    Shoes: $120. 3 years, 3 times/week. $0.30 per wear.

    Socks: $0.06

    Underwear: $0.06

    Total cost of dressing myself for work = $1.28

    This has proven to be a fun way to look at getting dressed! I’ve tried to remind myself to keep # of wears in the mental calculation whenever I’m shopping for clothes (which doesn’t happen often… let me tell you)

  2. Were you and The Shopper using the same idea of income when you were comparing how much you had to spend? My yearly salary is a good bit higher than your listed number but I have a feeling that after taxes our two numbers get a lot closer.

  3. After paying taxes and tuition (deducting both those things to get at real spendable income seems reasonable to me) his family is taking in triple what mine is at least. Probably not quadruple though.

    Our incomes, even considering taxes, are nowhere close and we have an extra person in our household.