Spending 101

By: Bob Guy

Spending money can be fun and some believe therapeutic. But the truth is, we spend way too much on things that we don't really need. Everywhere we go marketing and advertising is working it's mojo on our brains and psyches. We need to learn to recognize the signs and make better choices. Young people are especially vulnerable when it comes to advertisers messages. Usually, as we mature, we learn that companies are all trying to sell us something. Their goal is to make our money, their money.

The younger generation is under a lot more pressure to be hip and cool. They want to look like their favorite celebrities. They want to carry the same $350 purse that they saw on their favorite show. Once one kid does it, they all want to do it. They'll beg, plead and make up reasons why it's necessary to purchase something extravagant that will most likely be out of season or style in no time at all. Young people get addicted to the attention from their peers and the high that they get from showing up with the expensive bag or the pricey shoes. Once that high wears off, they're on to the next thing. It's important to teach the younger generations about advertising and what it means.

The first thing to keep in mind is that each and every company out there wants you to give them your money. Sometimes you need products and services, but sometimes you're duped into believing that buying something unnecessary was your idea to begin with. When you walk into a store, everything in the store is designed to make you want it. If it's clothing, then the most expensive hip new trend is probably prominently displayed in a window or on a spotlighted mannequin. Stores are arranged with their most expensive items at the front. Impulse buys are placed by the registers to make one last ditch effort at getting more of your money.

Grocery stores put items that they make the most profit from at eye level. Name brands are usually here because they are able to pay the most for their product positioning. Millions of dollars are spent every year by brand labels just researching which position on the shelf will most likely result in you picking it up and paying more for it than other brands. They pay top dollar for top position and the result is you thinking that it's somehow better than the other brands. Have you ever noticed that the most expensive sugary kids' cereals are located on eye level with a child? The most exciting candy is near the floor at the check out? This is definitely by design and encourages children to beg for the items that are only appealing to them.

The whole store is set up to encourage you to spend more than you planned on. Bread, milk and other common necessities are spread out on different ends of the store. Top selling items are near the middle of the isle. This encourages you to roam past impulse buys and pick up a few things here and there.

Keep your wits about you when you shop and you'll save money. Saving money doesn't just happen and you may have to make a concentrated effort. Avoid overspending and getting into a revolving credit card debt situation. If you have a financial emergency and want something short-term, consider a or that you can pay back quickly as opposed to a long-term credit balance that may have no end in sight.

Money Management
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