CCP Personal Finance Chapter 8 (Book)

Examples of social factors:

lifestyle, interests, hobbies, peer group, culture, advertising, media

service contrasts range between

$400 to over $1,000

The wise online buying activities cycle

1. Conduct online research -compare brands and feature -use label and warranty information -use product testing reports to assess quality, safety, nutrition 2. Compare stores -consider both stores and online -evaluate price, service, product quality, warranties, shipping cost and time, return policy -determine reputation, location 3. Make purchase -use secure buying website -seek discounts, coupons -select payment method based on security, fees, other factors 4. Plan for future purchases -keep receipts, other documents -know return complaint process -watch e-mails for special offers -evaluate time, effort involved

impulse buying

An unplanned buying behavior resulting from a powerful urge to buy something immediately. Can result in financial problems

Wise purchasing strategies

Timing of purchases, purchase location, brand comparison, label/package information, price comparison, warranties

Cooperative

a nonprofit organization whose member-owners may save money on certain products or services (credit unions are a financial services cooperative) bulk foods

rebate

a partial refund of the price pf a product

warranty

a written guarantee from the manufacturer or distributor that specifies the conditions under which the product can be returned, replaced, or repaired

service contracts

an agreement between a business and a consumer to cover the repair costs of a product they are frequently called extended warranties, but they are not warranties Beware of service contracts that offer coverage for three years but really only cover two years since the item has a manufacturer's one-year warranty

implied warranty

covers a product's intended use or other basic understandings that are not in writing

limited warranty

covers only certain aspects of the product, such as parts, or requires the buyer to incur part of the costs for shipping or repairs

new car warranties

main conditions -coverage of basic parts against defects -power train coverage for the engine, transmission, and the drive train -the corrosion warranty, which usually applies only to holes due to rust, not to surface rust

timing purchase

certain items will go one sale the same time each year, so if you wait to get something until then you will get a bargain

comparison shopping

process of considering alternative stores, brands, and prices

full warranty

states that a defective product can be fixed or replaced during a reasonable amount of time

residual value

the expected value of the vehicle at the end of the lease

money factor

the interest rate being paid on the capitalized cost

capitalized cost

the price of a car that is being leased

Unit pricing

the use of a standard unit of measurement to compare the prices of the packages of different sizes

Commonly overlooked trade-offs when buying include:

-paying a higher price over time by using credit to buy items that you need now -buying unknown, possibly poor-quality brands that are less expensive -ordering online, which saves time and money but may make it difficult to return, replace, or repair purchases -taking time and effort to comparison shop to save money and obtain better after-dale service

I am

too lazy to finish

express warranty

usually in written form, is created by the seller or manufacturer and has two forms: the full warranty and the limited warranty

Used Car Warranties

-FTC required "buyers' guide sticker" -Warranty of merchantability

Things to remember when comparing prices

-More store convenience (location, hours, sales staff) usually means higher prices -Ready-to-use products have higher prices -Large packages are usually the best buy; however, compare using unit pricing -"sale" may not always mean saving money

the average car buyer pays roughly how much of the list price

92%

the average car leaser pays roughly how much of the list price

96%

What factors affect daily buying habits?

Economic, social and personal factors. These factors influence your spending, saving, and investing choices, and when combined with wise buying activities can contribute to your long-term financial security

Examples of personal factors

gender, age, occupation, income, education, marital status, family size

Implied Warranty of Merchantability

guarantees that the product is fit for the ordinary uses for which it is intended a toaster must toast bread, an MP# player must play music

implied warranty of title

indicates that the seller has the right to sell the product

Examples of economic factors

inflation, interest rates, tax rates, government regulations, product safety

open dating

information about freshness or shelf life found on the package of a perishable product