LIVING FINANCE – CONSUMPTION TRAP (1)﹕NUMBER GAMES

Living Finance – Consumption Trap (1) ﹕Number Games

When you consider yourself is a clever consumer who are good at finance management, actually you may fell into consumption traps that you don’t even realize. In the coming blogs, we are going to break the theory and purpose of some common consumption traps with you in order to teach you to become a real smart living finance master.

We will start talking about the “Number Games” that businessman like playing this time. Every day, we are surrounding by many sugar-coating of number traps. They will make you have an illusion that you “earn” or “save some money” but actually they make you spend more than the budget. Let’s see two situations below to see if you have fallen into the traps before.

1st Situation: Buy More Cheaper

1st Situation: Buy More Cheaper

his trap is always used by supermarket. When you go to supermarket, looking at the shopping list, you may think that you will just buy the same amount as the list. However, when you see almost all yellow price tags in the supermarket’ shelves writing “Just buy one is relatively more expensive, buy more can lower average price and some of them even write down how much you can save. At this moment, do you feel sorry that if you don’t buy more?

However, if we think twice, suppose one package of instant noodle including 4 packs is $35, $58 for 2, you seem save $12. If that saved $12 divided by 8 packs of instant noodle, each pack just saves $1.5 which means each pack is 11% off. In order to buy the 11% off instant noodle, you have to pay 80% more than the original budget ($43). You may think that even though I buy more this time, I don’t need to buy next time. At last, I can save some money. But, can you guarantee that you won’t spend back the money saved this time?

2nd Situation: Buy One Get One Free

2nd Situation: Buy One Get One Free

Another common number trap is “Buy One Get One Free”. Seller will rise the original price at the same time offering buy one get one free in order to make consumer think it is very cheap. It is so common that many of us have seen some sale event which price tag marked “Original Price $99, Now Buy one get one Free”. You may think that if I buy now, I can earn $99. how could I miss it? However, do you really know the original price of the product? Actually, the “original price” marked by seller has no meaning unless you pay attention to its price for long-term and remember the rise and drop of the price of product. If not, the “original price” is just marked by seller whatever he wants. The effect of this kind of sales track is normally quite good as consumer intuitively thinks that he can earn $99 once he buys.

Now, do you still consider yourself knowing finance? In fact, if you figure out the number games carefully and don’t impulse buying, you can avoid from spending over budget and you can effectively mange finance. Everyone should remember that good finance management does not means save money at short time, it refers to spend as expected budget or even less that it. Moreover, finance management is a long-term planning that no matter you are just normal office worker or rich man like Lee Ka Shing, you should definitely learn about the way of finance management. Other consumer traps will be shared with you next time. Please keep an eye on it~

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