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2) I see many large pick up trucks, many with dual wheels, being driven with the tailgate open. That is because the owners think it gets them better mileage, alas, it is not true. Tests have been done showing that it matters not at all, whether the tailgate is up or down, the air tends to stay in the bed of the truck, it doesn’t push against the closed tailgate. However, with it open, there is a high risk it could fall off, and it poses a danger of someone hitting it,not only another car, but maybe a bicycle rider, crossing behind you. If you have the dough to buy a very expensive truck, and pay high insurance, and those huge tires, and you probably financed the thing for many years, is it worth even trying to save a few pennies, by a failed strategy?
The average price for a new vehicle is around 45 grand. Fancy trucks,with four wheel drive, can easily cost over 100 grand , and when it is financed over many years, that goes up quite a bit. Another big expense with all wheel and four wheel drive is often , if a single tire is damaged and cannot be fixed, you must buy 4 or 6 new tires, otherwise, you will damage the complicated drive systems. The cost of many things with a large truck , other than fuel, are the real wealth busters.
At least in my circles, when fuel was lower in price, the same people whom are complaining now, still didn’t have a rock solid financial future or strategy, and they were no better off a few years prior , then they are now. I suspect the reason is they simply spent extra the money on blue hair, tattoos, and 15 dollar bottles of water.
And speaking of water, I have expressed my views on how insanely expensive bottled water is, and, after doing some research, have discovered that tap water, with very few exceptions, is more highly regulated and monitored than bottled water. It is usually fresher, ( A notable exception is Flint Michigan), bottled water can sit in warehouses, trucks, etc., for a long time. And again, I will never agree that paying, in many cases, well over a hundred bucks for a gallon water, is a beautiful thing. Sorry. ( My previous post on water included the fact that my water bill for a whole year was 158 bucks, or, .003 CENTS per gallon. I had it tested and it easily exceeds standards)
I went to the pharmacy to buy some aspirin, the big name brand bottle was 3 times the price of the generic, I looked at the chemical makeup on the label, the 2 were identical, yet, the store sells 4 times more of the more expensive brand. Why might that be?
Jewelry is another product that is tremendously marked up. A thousand percent markup is the minimum, and many,including me, have been stunned to discover that, when trying to sell a fancy gold something, it will be weighed, and you will get a bit less than the value of the metal. it matters not how fancy and beautiful it might be.
Way back in 2008, the time of the housing meltdown, the collapse of Lehman Brothers, etc., the markets tanked, and where I worked, 97 people stopped contributing to their 401(k), and they also cashed out, 3 people did nothing, and 1 person, increased his contribution from 10 to 15 percent. The one person had recently read Ben Grahams book, etc.
I will protect his privacy, but, he is a bit short, fat, has red hair and freckles and a funny last name. Although that was a wise decision, his fails are far more numerous, and if he out lives Methuselah, he has a slim chance of turning positive. Don’t hold your breath.
Why, oh why, do so many otherwise astute people, feel that investments are somehow safer the higher they go, and riskier as they drop? Why do so many , that have decades ahead of them, fail to at least save some money? The Dow started last century at 66, and ended I am guessing, around 30,000, I think?
Finally, thank the Lord, and you are welcome, when I increased my contributions back 16 years ago, a vast majority felt I had surely taken leave of my senses. Oh well.
A brief note here, if I may. A friends daughter recently bought a very used BMW SUV with 86,000 miles on it.A large loan was required, and, she also bought a Toyota Corolla, as a “beater”, for the winter. And, surprise, it didn’t end well, a week or 2 after the used car warranty expired, which was 3 months, the Bimmer or Beamer, decided it would be very exciting to have a connecting rod break and pierce the engine block, then , for more thrills, it caught on fire.
This nice lady worked for 15 bucks an hour, and was stuck with a loan for many years, for nothing. The insurance value was way under what she owed. The Toyota now has over 300 k miles with no major problems.
To all of the great education people, teachers, and principals and school boards and the like, could you consider changing the curriculum a tad, and make personal finance, etc., mandatory? How to responsibly use money, make investments, avoid too much debt? Could we at least try it?
You’re confusing 2 entirely different things I think.
1) Mark up on products that is nothing to do with the cost of ingredients and everything to do with the the experience and convenience at the point of consumption. What’s a Picasso worth – almost nothing if you break it down to the costs of a canvas and paint. That really isn’t the point. Nor is the cost of tap water in the middle of a long hot journey when all you have is a vending machine in front of you.
2) Imprudent financial decision making around big purchases. Often “status” items might come with a high cost of upkeep. I’ve shyed away from that bargain Audi once the seller told me ( presumably because he thought it would show what a good deal it was) how much he’d put into bills on it in the past year.
I’ve got to admit that as someone with something of a thrift gene I find it insane that people with a perfectly good coffee machine on the counter will drive out to a Starbucks or whatever. But then I also recognise I might need to force myself to do that sort of thing in retirement for social and outside world interaction.
Re education. It’s been discussed before. I think the consensus is it only lands when the student is ready. Sometimes at least people need to make rookie mistakes before they are open to it.
With all the free personal finance tools out there, isn’t it time for people to own this. Khan Academy, Udemy, Coursera, local community colleges, it’s out there for the taking.
Unfortunately, education isn’t enough. If it was, nobody would be overweight, nobody would smoke or drink to excess, and we’d all exercise regularly.
So true. I see ads promising I can lose X pounds quickly and effortlessly, achieve physical fitness easily in “just minutes a day”, or how to build wealth easily and quickly. All for just a small price. So many of us fall for pitches which promise shortcuts to success with little sacrifice or work on our part.
When I purchase a vehicle I considered three things: price, gas mileage, and especially reliability. Beyond that you’re falling under the spell of the auto manufacturers. Is it really worth it for those people who buy the big expensive pickup trucks to look cool at the stoplight?
I would add safety features to your list.
I like your comments. You should do it more often.
“Really? No Really!” This is a podcast done by Jason Alexander and his friend, Peter Tilden. They explore topics such as this…that seem obvious and absurd but analyze it from a factual perspective (how do they really get away with marking up pop corn by an infinite %age). It is often humorous but always thoughtful and interesting. You should check it out.
Thank you, I will check it out. Also, if nobody bought the popcorn, the price would drop.
At the Garden , the home of Celtics and Bruins, a 16 oz.beer is twenty big ones and a single hot dog is 12.
But those darn big oil companies, charging 3 bucks a gallon for gas! So what if it has to come out of the ground, then be refined , additives, and taxed , heavily.
Here in Swansea, Ma, a quart of light cream is 5 bucks. Twenty per gallon. There are 3 dairy farms within a ten mile radius. Oh well.
Jeep now makes a Grand Wagoneer that can top 120,000 big ones. They are very unreliable and costly to maintain. Please, anybody whom buys one, I urge you to not complain about how much it costs to fill it with fuel.
Speaking of George, he is a riot. I saw the
Seinfeld episode when he asks his date, she wears chopsticks in her hair and paper hats, George asks her, “ What happens when it rains?”
Do you feel better now, lol? I entirely agree about bottled water, I only drink it in places where the tap water is unsafe (where you should also avoid ice and raw veggies). However, the jewelry issue makes sense. When you buy jewelry you are paying both for the components and for the time and expertise to craft the object. When you sell it it will probably be melted down, so the the only value is in the components.