A Bodey in Motion

Building momentum, one step at a time

FPU Lesson 5 – Buyer Beware

With the fifth lesson, we start putting up our shields and gaining power over our spending habits. Below are my notes from the lesson, including the key points that I highlight from the video when leading the class, and some supplemental material that I think could help the class go further on this topic.

Financial Peace Unversity

Lesson 5, Buyer Beware

Key Points

Learning the methods used to market products to you can put you back in control. Major corporations and organizations spend millions of dollars determining the best ways to convince you to buy their stuff. Color (Century 21 signs are an ugly shade of yellow for a reason), repetition (who deserves a break today?), perceived value, product placement, and on, and on. What they’re doing isn’t necessarily illegal, or even immoral, but it’s important for all of us to be aware of  it.

Always talk to your spouse before making any major purchase. Each family has to determine for itself how much constitutes a “major purchase.” (On average, it’s about $300.) When you get ready to buy something over that number, though, everyone has to agree to the reasons the money is being spent. No exceptions.

Wait 24 hours before making a major purchase. One of the biggest traps we fall into in our culture is the false sense of urgency that is applied to everything in our lives. We’re always being urged to “ACT NOW!” It causes to move on a purchase before we’ve completely thought it through. By taking the time to sleep before you spend the money, you give yourself the chance to feel the true weight of that purchase.

Challenge

End Immaturity. On its own, “I want it!” isn’t a legitimate reason to make a purchase. Tell your inner child to shut up by memorizing and implementing these five key strategies:

  1. Wait Overnight. (We’ve already covered this one.)
  2. Consider Your Buying Motives. (Consumption will never result in happiness.)
  3. Never Buy Anything You Don’t Understand. (If you can’t explain it, then you don’t understand it.)
  4. Consider the Opportunity Cost. (If you spend this money here, what are you unable to use it for later?)
  5. Seek Counsel. (Start with your spouse, but also have wise friends. Maybe even a financial coach is needed.)

Go Deeper

  • Affluenza: The All-Consuming Epidemic by John de Graaf, David Wann, and Thomas H Naylor
  • Stop Acting Rich: …And Start Living Like A Real Millionaire by Thomas J. Stanley

Next week:, lesson 6 – The Role of Insurance (Everyone say “Yay! Insurance!”)

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April 3, 2013 - Posted by | Marriage and Family, Past and Future, Work and Money | , , , , , , , , , , ,

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