Avoiding the Impulse Buy

Summary
  • Nearly 40% of all money spent on e-commerce sites are the results of impulse buying – it’s big business
  • Impulse buying is bad. Left uncontrolled, it leads to credit card debt.
  • How to avoid impulse buying
  • Are you compensating for something?
  • We offer suggestions for alternative activities that are good for you
What is Impulse Buying?

The dictionary says:

im·pulse buy·ing
noun

 

Do you impulse buy?

Factoid: Nearly 40% of all money spent on e-commerce sites are the results of impulse buying.

The two most influential factors when making a spontaneous purchase are the special sale price (for a limited time) and free shipping.

Let us ask again, do you impulse buy? Be truthful to yourself now.

For business, impulse buying is a huge opportunity! There is a science behind encouraging consumers to do so. Read How to Sell to Impulse Buyers. Retailers describe these shoppers as emotionally-driven, favoring instant gratification, social status-conscious, and image-concerned, anxious, or less happy/depressed. Techniques that retailers use to encourage impulse buying include:

  • Special sale price, usually “for a limited time”. Why do you think that is?
  • Brick-and-mortar retailers place nick nacks near the checkout counters.
  • E-commerce sites with their easy to use web site with lots of impulse buying suggestions such as “Related items”, or “What others are buying”.
  • The one-click checkout makes it very easy. Too easy. Scary easy. One click and it’s yours. Money changes hands, yours into theirs. No longer do you have to put in your credit card info, your shipping address, confirm the item and quantity. Instead, it’s “bam!” And it’s done.
Warning! The "Buy now with 1-Click" button is conducive to impulse buying
Warning! The “Buy now with 1-Click” button is conducive to impulse buying – disable it now.
Why is Impulse Buying Bad?

Impulse buying is bad because it puts your ability to save money each month at risk, depletes your savings, gets you into and debt, and eventually erodes your freedom.

“Freedom?” You ask.

“Yes, freedom! Freedom to eventually do anything you want, any time you want, and being able to pay for it. And pay for it just once.”

“Paying for it just once?” You ask.

“Yes, just once. When you can’t live within your means, you’re going into debt.”

For most consumers, it’s usually credit card debt that gets them into trouble. When you’re in debt, you pay for the amount you borrowed (the principal) and interest on that principal. And your total payments snowball in comparison to the original amount borrowed. When you make a monthly payment, the first portion of that payment goes toward the interest for borrowing the principal. Then what remains go towards lowering the amount you borrowed. Let’s go through a couple of examples:

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Discount Fares to Europe

Summary
  • Norwegian offers discounted airlines to Europe, as low as $385-$440 round trip for Spring and Fall departures
  • Non-stop service from U.S. Cities: Los Angeles, Oakland, New York, Miami, Orlando
  • European gateway cities include Oslo, Copenhagen
  • Best fares are in the Spring and Fall
  • As with discount airlines, meals are extra, carry-on baggage has limitations
  • It’s a great way to see Europe in the shoulder/off season if you have schedule flexibility and travel really light

Norwegian Air Shuttle ASA was a regional discount airline in Europe. In 2014, Norwegian started their new Boeing 787 Dreamliner non-stop service from select U.S. Cities to European gateway cities like Copenhagen and Oslo. Since then they added non-stop flights to select European cities such as Paris (CDG, ORY), London (LGW), and Madrid (MAD).

Norwegian Boeing 787 Dreamliner
Norwegian offers Boeing 787 Dreamliner non-stop service to Europe from select U.S. cities. (photo credit: Norwegian)

Norwegian current serves the following U.S. cities: New York (JFK, EWR, SWF), Providence (PVD), Ft. Launderdale, Orlando, Las Vegas, Los Angeles (LAX), Oakland (OAK), and Seattle (SEA).

We took a flight from Ft. Lauderdale, FL (FLL) to Paris Orly airport (ORY) in May 2014 and the service was efficient. The Boeing 787 Dreamliner was very comfortable for the 8+ hour non-stop flight.

Example Deals

The best deals can be found any time but the summer months. Norwegian does have occasional sales for more upgraded seats, but their claim to fame is the discounted “LowFare” in the Spring and Fall months. Buy early though, because once they fill a certain amount of seats, their fare prices start to creep up. Here are some example deals, as researched on September 23, 2017.

Example #1. Los Angeles (LAX) to London (LGW) non-stop for May 2018 is as low as $454 round-trip.

Norwegian Los Angeles (LAX) to London (LGW) non-stop for May 2018.
Norwegian Los Angeles (LAX) to London (LGW) non-stop for May 2018.

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Budgeting 101 for College Students

Summary
  • Get some discipline and live within a budget: your financial well-being will thank you for a lifetime
  • Establish a budget:
    • focus on getting/staying out of debt
    • build up a “rainy day” savings fund
  • Some tips for living within a budget
  • Follow through and track your expenses: be accountable to your budget
  • Download: a sample monthly budget spreadsheet to help you jump start the process
Do you need a Budget?

Yes.

Do you remember the Disney-Pixar classic animation Toy Story, where Sheriff Woody says, “If you don’t have one, get one!”

“If you don’t have one, get one!”
“If you don’t have one, get one!”

He was actually talking about moving buddies, to safeguard Andy’s toys from being lost in the chaos of the residential relocation. The same advice holds true for a budget. So that your financial well-being does not get lost in the chaos of life, give yourself the discipline of a monthly budget. It will thank you for a lifetime.

Why Live Within A Budget?

Living within a budget is not sexy or cool. But it gives you freedom.

“Freedom?” You ask.

“Yes, freedom. Freedom to eventually do anything you want, any time you want, and being able to pay for it. And pay for it just once.”

“Paying for it just once?” You ask.

“Yes, just once. When you can’t live within your means, you’re going into debt.”

For students, it’s usually credit card or student loan debt. When you’re in debt, you pay for the amount you borrowed (the principal) and interest on that principal. And your total payments snowball in comparison to the original amount borrowed. When you make a monthly payment, the first portion of that payment goes toward the interest for borrowing the principal. Then what remains go towards lowering the amount you borrowed. Let’s go through a couple of examples:

Continue reading “Budgeting 101 for College Students”

Open-Box is the Best Buy

Summary
  • Best Buy’s Open-Box deals are the truly the best buys, especially on top of a sale or clearance, as the discount is even deeper.
  • Online Open-Box deals at BestBuy.com offer free shipping, which is sometimes an option in case the open-box item is not at a store near you.
  • “Certified” or “Excellent” condition open-box deals are almost like new and represent the best value.
  • We cite some examples savings of up to 36%-45% from original retail.
  • Tips for snatching these open-box deals: Quantities are limited. Timing is everything, so act fast. Add to shopping cart and checkout immediately. If it does not meet your expectations, you can return the item to your local Best Buy store for a full refund within 15 days.

Shopping for a new computer? A new home theater receiver? You don’t want to pay full price, and love a bargain? So we’ve got something in common, ha! If you like buying from Best Buy either in-store or on-line, you’ll like this…

In our experience, we have found that at Best Buy, the Open-Box deals are truly the best buys. Here is an example: a previous-year model iMac 27″ all-in-one desktop computer originally retailed for $2000. A brand-new iMac in a factory-sealed box is on clearance/sale for $1500 (25% off), while an open-box “excellent” condition is only $1275 (total of 36% off). In comparison, Amazon was offering it for $1800 (10% off) with free shipping.

iMac 27"
iMac 27″ open-box deal is $725 off or 36% below original retail price

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The Question of the Ages

I like this dialog from the opening scene of the movie Alien: Covenant…

opening scene from Alien Covenant
opening scene from Alien: Covenant

May I ask you a question, father?

Please.

If you created me… who created you?

"If you created me... who created you?"
“If you created me… who created you?”

Ah. The question of the ages…
which I hope you and I will answer one day.
All this. All these wonders of art, design, human ingenuity…
all utterly meaningless in the face of the only question that matters.
Where do we come from?
I refuse to believe… that mankind is a random by product of molecular circumstance…
no more than the result of mere biological chance.
No.
There must be more.

Acknowledgement: Movie stills are the property of Twentieth Century Fox Film Corporation. Copyright, all rights reserved.