Being a wise consumer: Be informed, be smart!

26 November 2018
Submitted by Family Services of Greater Vancouver

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Ever make a purchase and have regrets afterwards? Why did I ever buy this?!  Buyer remorse can affect everyone at some time.  But there’s things you can do to prevent yourself from making hasty and regrettable consumer decisions?  In some cases, you may be able to receive a refund on the transaction, in other cases, you may be stuck. Some tips on being a smart consumer when considering a purchase of goods or services:

Ask yourself: Are you receiving useful information or is it a sales pitch?  With the enormous surplus of info on-line, it becomes increasing difficult to discern reliable information from sales promo.  Trump has not cornered the market on misinformation, un-truths and distorted facts, so be sceptical of anything you read, hear or see on any platform.  Many sources rely on advertising, so ask yourself: if a magazine receives millions of dollars in advertising from a company, are they likely to give negative reviews of that company’s products?  Publications such as Consumer Reports, which accept no advertising, are much more likely to provide unbiased information.  Other unbiased tools such as the Government of Canada’s financial comparison tools help you compare a variety of financial products without the sales job.

Check on your cooling off period.  For many contracts you are legally entitled to a cooling off period.  This may range in length of time. For a gym membership it generally within 10 days of receiving your contract, for an RESP group plan contract it is 60 days, for a phone contract it is 14 days and up to 50% of the data usage (one month and 100% of the data usage if you have a disability). Always know what the terms are before signing any contract and hang on to a copy.

Determine the return policies. Buyers remorse can be a lot more stressful when you have no return options.  Some retailers will go by all sales final (particularly on sale items), whereas other retailers’ return policies will range from 7 to 60 days with some even offering unlimited returns.  Some retailers will offer a cash refund, whereas others, only a store credit. Know ahead of time and always keep your receipt.

Find out the fees, charges and penalties.  When purchasing a financial service or product know what the extra charges are: Is there a set-up fee? Yearly administrative fee? Penalty for closing your account?  Transfer fees? These can all add up and cut into how much of your hard-earned cash you have left. Read the contract carefully.  Some contracts contain more clauses than a mall at Christmas.  Keep your copy of any contract in a safe place.

What are the motives behind the salesperson’s recommendations:  Ask yourself: Are they selling me this financial product or service because it is good for me, or because it is going to make them a good commission, or the company more money?  Some financial products are much more profitable than others.  Unfortunately, transparency is often lacking, so it is up to you to dig a little deeper to find out.  Services such as RESP group plans, credit card balance insurance, and extended warranties are examples of products or services that line the pockets of the companies offering them more than they do the consumer.

Murray Baker is a Financial Facilitator, Coach and Manager, Financial Empowerment, with Family Services of Greater Vancouver. He is also a speaker and author of the bestseller The Debt-free Graduate: How to Survive College Without Going Broke, now in its 14th edition.