Involves making comparisons to help decide what to shop for and where to shop. Only comparison shop as necessary by weighing time and transportation costs. Advertisements and coupons can help save time and money.
Club warehouse stores generally offer the lowest prices, but their items are only sold in large quantities. Club warehouse store : store that carries a limited number of brands and items in large quantities and is less expensive than supermarkets. Convenience stores carry few items, have highest prices, but are open more hours. Convenience store : store open 16 to 24 hours a day, carrying a limited selection of relatively higher- priced items.
Brand names are well known nationally or regionally. Some supermarkets or wholesale stores have their own brand names known as private labels or store brands. Generic products have no brand name.
Style Buying current styles, which tend to change each year, can be expensive because new clothes must be bought annually. Buying classic styles, which are more basic and do not change as much, will help your clothes last longer, saving money.
Durability Durability : ability of an item to last a long time Service Flow : amount of use a person gets from an item over time and the value a person places on this use Way to measure durability of a clothing item. Cost of Care Factor in the cost of care involved in clothing that must be hand washed or dry cleaned versus machine washable.
Clothing costs have decreased significantly over time. 70 years ago, a good suit cost about $40 and it took the average consumer 80 hours of work to make enough to buy the suit. Today, a good suit sells for around $500 but it take the average worker 40 hours to afford the suit.
Clothing sales generally happen at the end of the season. Bargain fanatics buy items just because they are on sale. If you buy an unnecessary item because it’s on sale, you may not be saving money at all.
Avoid spending more than you can afford. You will need the cash down payment and closing costs. Closing costs : fees involved in arranging for a mortgage or in transferring ownership of property Be aware of points or fees paid to the lender. Points : fees paid to a lender and computed as a percentage of a loan
Many different types of mortgages and financing packages are available. Mortgages involve down payments and interest. Mortgages are paid in monthly installments. Property tax, homeowners insurance, and mortgage insurance are often included.
Standard Fixed-Rate Mortgage Interest rate and monthly payments remain the same over the term of the mortgage- usually 15 to 30 years. Flexible Rate Mortgage Interest rate and monthly payments float up of down along with interest rates in general. Rates can increase by no more than a few percentage points over the life of the mortgage. There is often no limit on the amount of decrease.
Federal Housing Administration Mortgage The FHA will insure the entire amount of its mortgages. This added security makes it possible for borrowers to obtain a larger loan than they would with an uninsured mortgage.
Graduated Payment Mortgage Interest rate is usually fixed for the life of the mortgage. Monthly payments are small at the beginning and increase gradually over the years. For people who expect their income to increase steadily
Veterans Administration Mortgage These loans can be obtained only by qualified veterans or their surviving spouses. The interest rate is generally lower than for other mortgages. The VA guarantees a large percentage of the loan. Loans with now down payment are possible under the VA program.
Renters usually sign a lease. Lease : long-term agreement describing the terms under which property is rented Be aware of the clauses in your lease; read it carefully. Tenants have a right to use the property for the purpose stated in the lease, and a right to privacy.
Tenants must pay rent on time, take care of property, and notify landlord if major repairs are needed. Some tenants must place refundable security deposit in case of damaged property or unpaid rent. Security deposit : money a renter lets an owner hold in case the rent is not paid or an apartment is damaged.
Tenants must give written notice if leaving prior to lease’s end, which can result in fees and fines for breaking the lease. Landlords must provide minimum services and obey building and safety laws. Rent-control laws limit the amount a landlord can charge in rent.
Registration Fee Registration fee : licensing fee, usually annual, paid to a state for the right to use a car Normal Maintenance and Repairs The amount of normal maintenance- oil and filter changes and minor tune-ups- depends on the amount the car is driven and how carefully the owner maintains the car. Major repairs are not normally expected and are often expensive.
Extended Warranty One way to guard against paying for major repairs is to buy an extended warranty. New-car warranties generally protect owners for all major repairs except damage caused by improper use. Depreciation Depreciation is a decrease in value of the car as it ages. A car loses value every year even if it not driven.
Most states require liability insurance be purchased before an automobile can be licensed. Liability insurance : insurance that pays for bodily injury and property damage Rates cannot vary too widely because states set limits on the rates that companies can charge within state borders.
Cost of insurance varies based on age, sex, and driving history. Young people almost always pay higher rates. Single males in the 16-25 age group have the highest accident rate of all drivers and pay the highest rates. Married women aged 25-45 have the fewest accidents and the lowest rates.