Friday, July 17, 2009
Look Out For Yourself
Saving Money Tip #164 - Look Out For Yourself. Very few people out in the real world have your best interests at heart. They may not be out to get you, but most are not out to help you either. And as it pertains to finances, they probably don’t care if you spend more than you can afford, if you get the best deal, or if you get what you want. That’s why you need to look out for yourself. Used car salesmen have a notorious reputation for being slimy. No one expects them to have your best interests at heart. But what about a realtor? Most people who buy houses love their realtors. And if you are in the market to buy a house, a realtor can be a great asset. But remember, that person has a job, and that job is to sell you a house. He or she may not care whether it is in the best neighborhood for you or if you can really afford it or whether you can get a better price for it. She may care, but she may not. That’s why you need to look out for yourself. Research as much information as you can about prices in your target neighborhood. Be realistic about what you can afford; don’t just go by an industry standard. Don’t settle for less than you want just because someone told you to do so. You have your own best interests at heart, so figure out things for yourself.
Buying a house isn’t the only area where you need to look out for yourself, but it is the biggest one-time cost most people incur in their lifetimes. Another area to be careful in is in investments. Suppose you want to start investing some money in places more sophisticated than the bank. Someone gives you the name of a financial advisor and you meet with him or her. He gives you some places to invest that he thinks will be good for you and you follow his advice. Did you know that he may be making money off your investments? Did you know that certain companies might be paying him a commission from what you bought? Some financial advisors or planners work on a commission basis. Company A might pay him 1 percent of your investment if you invest your money with Company A. But Company B might pay the advisor 2 percent of your investment if you invest it with their firm. Which firm do you think he’ll advise you to invest in if he doesn’t have your best interests at heart? There might not be anything legal wrong with what this person is doing. But if you the person is looking out for you and your investments, and he is not, you may get screwed.
And it’s not just the big purchases or the major events where you need to look out for yourself. The little things matter, too. The salesman selling you the television on the showroom floor cares about his store’s bottom line or his commission; he may not really care whether the Panasonic or the Sony is a better model for you. The bookseller up the street is not going to suggest that you can get a cheaper price for the same book on Amazon. Nor is the sporting goods store salesman going to tell you to check out Wal-Mart for a tennis racket.
And it’s not just salespeople who aren’t necessarily looking out for you. You need to keep on top of your doctor, your dentist, your activities, your vacations, your utilities, and just about everything you buy. Again, I am not saying that people are out to get you nor am I saying that there aren’t caring, dedicated realtors, investment advisors, or store salespeople. What I am saying is that you cannot assume that the person helping you is looking out for you. Some will and some won’t. And unless you know for sure which type the person is who is helping you, you need to look out for yourself.
In Real Life (IRL) – We stayed in a hotel this past weekend when we went up to my parents’ 50th anniversary party. I did my research and compared similar hotels’ prices online. I called the one that I thought was the lowest. I was quoted a rate on the phone, however, which was higher than I wanted to pay. When I told her I’d call back, I was suddenly offered a lower rate. Obviously, the hotel wants to rent their rooms for the highest rate possible. The goal of the hotel person on the line was to get me to reserve a room at the highest rate she could. And when that didn’t work she lowered the rate to one that she and I found acceptable. She was looking out for herself (and her job) and I was looking out for mine.
At one time I was seeing a highly recommended, highly regarded fertility doctor because I had had two miscarriages. While seeing him, I had a third miscarriage, and I told the doctor I was done trying to get pregnant. I mentioned that it was causing too much emotional turmoil and stress in my life. And that I couldn’t go through getting pregnant again only to have it not last. I proceeded to tell him how I had always dreamed of adopting, and now I was going to go that route instead. Do you know what he said to me? “There are so many complications with adoptions. And I’ve heard so many bad stories. Why don’t you try this fertility procedure instead?” Seriously. This is supposed to be a caring, compassionate doctor who is looking out for a hurting, vulnerable woman, and that was his answer? Was he hoping to eek a few more dollars out of another treatment for me? Based on what others have since told me about him, I think so.
The bottom line is, nobody will look out for you like you (and maybe your mother) will. There are caring, compassionate people out there, for sure. But unless you know without a doubt that you are dealing with one of them, make sure that you are looking out for yourself. You may save a lot of money and heartache in the long run. For other ideas on saving money, check out Frugal Fridays.