Posts filed under 'Shopping'
Researcher Kent Monroe has developed a test to tell if you are a shopaholic. The new test includes six statements, for which individuals answer on a 7-point scale from strongly disagree to strongly agree:
1. My closet has unopened shopping bags in it.
2. Others might consider me a “shopaholic.”
3. Much of my life centers on buying things.
4. I buy things I don’t need.
5. I buy things I did not plan to buy.
6. I consider myself an impulse purchaser.
Respondents who score 25 or higher are considered compulsive buyers. Monroe administrated his test to 550 staff members and found nine percent (men and women) qualified as shopaholics. LiveScience.com reports that previous studies have shown that between two percent and eight percent of the population are shopaholics.
March 16th, 2009
Our consumer society has stopped consuming. Whether for big ticket items or smaller desires, we have stopped shopping. But is this a temporary reaction to the current economy or something deeper and permanent? Have consumers changed their ways for good?
Consumer spending makes up approximately 70 percent of the economy. It topped out at 71 percent in 2005. Current economic conditions combined with the upcoming credit card bust (see “Credit Cards and Hemlines”, December 1, 2008) means that many folks will not be able to borrow money at good rates for a while. People who have lost 40+% of their net worth over the last six months won’t soon forget this year. Stories of hoarding for years after the great depression are common. On the other hand, 20 years from now, consumers who are now in their 20’s may not remember this downturn when they reach their peak spending.
Prevailing wisdom says that permanent change will never happen to the American consumer. What do you think? Has our love of owning plentiful and fine things altered permanently?
March 13th, 2009
Kitty tried to slam down the phone receiver. Damm her lack of opposable thumbs and damm Barbie. They had been vying for sexiest toy title for years. Kitty thought she had Barbie beat when she went for the big time bling. But now the diva was topping her with a runway show on Feb. 14 in Bryant Park, complete with designer inspired Barbie clothes. What was the world coming to? Then Kitty sat back and purred – she still had her line at Neiman Marcus and a higher net worth (see November 17, 2008 post for more on net worth). And, wasn’t Barbie turning 50?
http://www.nytimes.com/2009/02/05/fashion/05ROW.html?_r=1&ref=todayspaper
http://www.neimanmarcus.com/search.jhtml?N=0&Ntt=heloo+kitty&_requestid=15797″
February 5th, 2009
Starlets and their cell phones. Inseparable. Gossip? New movie deal? No, smart money management. Two new cell phone applications help you shop:
Lucky Magazine has created Lucky At Your Service which ties into stores’ inventories. The app featured over 70 shoes in its March shoe guide. Click “find it near you” and either GPS or a zip code can tell you which stores have what you’re looking for. The best part, it’s free. Download it at: http://corp.nearbynow.com/luckyatyourservice
ShopSavvy (www.biggu.com/applications) also acts as a personal shopping assistant. You scan an items barcode with your phone’s camera and the app shows you the lowest prices online and at nearby stores.
Even starlets need to save.
February 2nd, 2009
Cinderella stomped her foot. Where was her fairy godmother when she needed her? Marrying the prince had not turned out happily ever after and she had become quite short tempered. The monotony of palace life was bound to get on anyone’s nerves. She knew her shopping habit was out of control. Since it was her job to be the belle of the ball, and Manolo’s are so pretty, she had always been able to rationalize her purchases. Lately though she had begun to feel embarrassed. She had taken to putting her purchases into plain brown bags so the prince – and town people – couldn’t monitor her spending.
She knew she was overspending and if she didn’t start cutting back on expenses she would have to go back to work. Unfortunately, due to her limited skill set and education, that meant a return to the scullery.
She needed her fairy godmother to wave her magic wand and fix it all. After all, that woman could do anything. Then reality hit. Her fairy godmother had been cut in the last round of palace lay-offs. She was going to have to go it alone.
Rather than panic, she decided to do some homework and some financial planning. To begin she re-read some of the post from So Many Shoes – especially the ones on credit cards, interest rates and debt. She also turned to No Regrets for savings ideas. She vowed to get her financial life under control and to check back more often.
January 28th, 2009
Recent statistics show that the Botox treatment industry has generated over $1 billion per year in revenue. When an industry hits that threshold, it’s a viable, on-going market. Although the recent market downturn may put a slight wrinkle in sales, younger and younger women are now trying the procedure. A growing number are getting Botox the moment they graduate from high school.
This is an example of really bad money management – not to mention a totally unnecessary cosmetic procedure. At upwards of 300 dollars per appointment, you would be much better off paying down your credit card or other debts or saving or investing. Even if you are completely debt free, and can truly afford it, there is plenty of time to freeze your face.
If you put the $300 in your savings account instead and earned 4% interest, in five years you would have roughly $1,460 dollars ($300 x 4 times a year – usually you need three to four injections per year). If you waited five years to start Botox, and saved the money each year, you would have saved approximately $6,700. What could you do with $6,700?
January 16th, 2009
There are two kinds of interest: Simple and compound.
Simple interest means that when you borrow money, you pay back the amount you borrowed, which is called the principal, plus the interest. The interest is only calculated on the amount of the principal. The amount of interest you pay back depends on the interest rate, which is usually expressed as a percent due for a full year, and the length of time over which you borrow the money.
There is a formula for calculating simple interest: Simple interest equals: Principal multiplied by the interest rate multiplied by the length of time. While you don’t need to remember the formula, please note two things: (1) The formula only uses multiplication and, (2) You know what each of the things you need to multiply are.
Here is an example of how to calculate simple interest. If you borrowed 1,000 dollars (your principal) at a 10 percent interest rate per year (the bank’s fee), for three years (the time period), the simple interest rate is: 300 dollars (1,000 dollars multiplied by 10 percent interest, multiplied by three years, equals 300 dollars). The total amount you would owe the bank at the end of the three years would be 1,300 dollars (1,000 dollars, the original amount you borrowed, plus the 300 dollars interest).
Compound interest is like simple interest in that when you borrow money, you pay back the amount you borrowed plus the interest. However, unlike with simple interest, where the interest is calculated only once, for compound interest the interest is calculated at the end of each compounding period. A compounding period is how often interest is charged – which can be yearly, monthly, weekly and even daily. This means you are charged interest on the prior period’s interest as well as interest on the principal.
Here is an example of how compound interest is calculated. In the simple interest example above, we borrowed 1,000 dollars at a 10 percent interest rate per year for three years. If the bank charged compound interest instead of simple interest, and they were compounding the interest annually (once a year), we would use the same formula: Interest equals the Principal multiplied by the Interest Rate multiplied by Length of Time, but we would use it three times.
In year one: 1,000 dollars, multiplied by 10 percent, multiplied by one year, equals 100 dollars. The total amount owed at the end of year one would be 1,100 dollars (1,000 dollars, the original amount you borrowed, plus the interest, 100 dollars).
In year two: Perform the calculation again, but this time use as the starting point 1,100 dollars – the balance at the end of year one. To calculate year two, multiply one 1,100 dollars, by 10 percent, by one year. This equals 110 dollars. The total amount owed at the end of year two is 1,210 dollars (1,000 dollars, the original amount you borrowed, plus 100 dollars, the interest from year one, plus 110 dollars, the interest from year two).
In year three, start with the 1,210 dollars from year two and perform the calculation again: 1,210 dollars multiplied by 10 percent, multiplied by one year. The total amount you would owe at the end of year three is 1,331 dollars (1,000 dollars, the original amount you borrowed, plus 100 dollars, the interest from year one, plus 110 dollars, the interest from year two, plus 121 dollars, the interest from year three).
The higher the interest rate, and the more you borrow, the bigger the difference between simple and compound interest becomes. Unfortunately for borrowers and credit card users, the interest on most long-term debts and all credit cards is calculated using compound interest. Banks know how much the difference adds up.
January 15th, 2009
Today, Obama spoke about the current economic crises. He pointed out that “this crisis did not happen solely by some accident of history or normal turn of the business cycle … we arrived at this point due to an era of profound irresponsibility that stretched from corporate boardrooms to the halls of power in Washington, DC. … Banks made loans without concern for whether borrowers could repay them, and some borrowers took advantage of cheap credit to take on debt they couldn’t afford. The result has been a devastating loss of trust and confidence in our economy, our financial markets, and our government.” He’s right.
The recent economic headlines have been enough to make anyone nauseous. Money-savvy people are scared and financial novices are terrified. One of the most important promises you can make to yourself this year is to learn about money and personal money management. I realize learning about the economy can seem intimidating, math feels boring, and managing your own finances daunting – but if you can shop, you can manage your money.
Shopping actually requires you know more math than money management. For example to spend, you need addition and subtraction. To budget, you need addition, subtraction, and multiplication. To over-spend, you need addition, subtraction, multiplication and division. To shop, you need addition, subtraction and multiplication. Percents and decimals also help – especially if there is a sale! Notice that algebra is not listed; geometry is nowhere is sight (although one way to save money is to angle around the outer perimeters of the shoe department); trigonometry – forget it; calculus – don’t need it.
So make a commitment to yourself and learn about money. You’ll feel even better than you do when your skinny jeans fit.
January 8th, 2009
In this time of austerity, black is the new black. It fits the mood, makes you look thinner and taller, and can save you money…I’m going to guess you already own more than a few things in black and won’t have to add very many items to your wardrobe to be in style.
Fashionista Fact:
“____ is the new black” started with the legendary Vogue editor Diana Vreeland in 1962, when she observed that “shocking pink is the navy blue of India.” Vreeland was commenting on the copious use of pink as the base color for much of the attire in India, much like navy blue at that time the core color of most outfits in New York City. In the late 1970’s the expression changed to “X is the new neutral” which morphed in the 1980’s to “X is the new black.”
December 11th, 2008
The best gift you could give yourself this holiday season is to get though December without incurring additional debt. Believe it or not, your friends love you for you – not for the gifts you give them. If they don’t, get new friends.
Not paying your credit card bill in full every month is one of the worst things you can do for your finances, except in emergencies. Unless you can pay your bill in full every month, use a debit card instead of a credit card. If you are unable to pay your bill in full when you receive it, pay off as much of it as you possibly can. Do not use the card again until you have completely paid your bill and have a zero balance. The reason you want to pay as much as you can possibly can is the more you pay now, the lower your outstanding balance (what you owe the credit card company) and the less interest you will owe on the balance. Remember, interest is calculated on the amount outstanding. If you pay only the minimum required, you will pay the credit card company a lot of interest.
There are lots of ways to give without spending a fortune: Many websites and magazines have gift lists in various price ranges – use the range that you can comfortably afford. Diets aside, don’t over look home baking. Fattening deserts are always a crowd pleaser. Parties are good too. Arrange a pot-luck so everyone shares the cost and each others company. A heartfelt phone call wishing them a happy holiday and letting them know you are thinking about them is often better than any gift. Last but not least, since today is global AIDS awareness day, don’t forget charities. Making a donation in a friends name is a great way to honor them – and to help others in need at the same time.
December 1st, 2008
Next Posts
Previous Posts