Last week, I talked about the Rules of Money, and where there is money there is SPENDING. We couldn’t get through Financial Literacy Month without talking about how we spend our hard earned cash. If you want to do well financially, there is a sure-fire way to do it. Spend your money wisely. Remember, one of my Money Rules says it all: It really isn’t about how much you make, but what you do with it that counts.
In my book about personal money management, Money Smart, I share the 10 Rules of Spending Wisely. In the previous two blog posts, I shared the first two of three Spending Rules, and here is the third rule that will help you get the most from the money you spend.
Spending Rule: Understand Today’s Sales Game
Thanks to technology, the game of selling has changed quite a bit in recent years. That’s why you need to understand today’s sales game. If you don’t, you will be at high-risk of spending far too much of your hard-earned money where you really didn’t intend to—and even being played for a sucker at times. Here’s another way to ensure you spend your money wisely.
Let’s say you want to buy a car. You go to a dealer and take a test drive. The salesperson makes a copy of your license, as required in case you take off with the car. While you’re driving, he keys your license number, and the license number of the car you just drove in with, into his computer. By the time you get back he knows a lot about you, like your credit history, car ownership profile, financing history, and more. If you’ve already visited another dealer the chances are good he now knows what happened there, like how much you were offered for your trade-in and the reason why they didn’t close the sale.
Don’t think he’s just trying to sell you a car. He’s after a lot more. On the financing alone he doubles his commission. And the same goes for the trade-in. Then there are the warranties, maintenance contracts, VIN etching, fabric protection… The list goes on and on. Today’s auto industry is on the cutting edge when it comes to sales techniques and tracking online research. Learn to handle auto salespeople and you can handle almost any other type of salespeople.
To protect yourself and to become a smarter consumer, educate yourself. I wrote Money Smart as a common sense manual for learning to manage your money in everyday living. Read and put into action the 10 Rules of Money and the 10 Rules of Spending, and you will make your money go farther and be more successful with money.