Beating Broke

Personal Finance from the Broke Perspective

Are You a Patient Purchaser?

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Conventional wisdom, at least in frugal personal finance circles says you should wait several days (or even weeks) before making most purchases.  Especially large purchases.

Personally, I’m usually a pretty patient purchaser.  I hate paying retail for most things. When I decide I need something (or even want it), I usually start my search on eBay.  Only when the price on eBay is pretty close to retail, or when I just can’t get something at a discount will I purchase it through a retail outlet.  And even then, I generally wait for a sale.

Patience is a Virtue

The main reason that experts suggest that you wait on a purchase is that, after thinking about it for a few days, most people will decide that they don’t need the item, or that they don’t want to spend the money on it right then. It also prevents spontaneous purchases.  I seldom find that to be true.  Well, not entirely, anyways. There have been a few cases where I’ve decided that I really didn’t want the item.  I’m also frugal to a fault, and rarely make a spur-of-the-moment purchase.  If I see something that I want, I’m off to research it and find the best price for it.

Limited Time Offers

LTOs are my downfall.  Because of their limited timeline, I don’t have the luxury of waiting until I can do the same amount of research that I normally do.  I still have a hard time purchasing the item, but have been known to buckle under the pressure and pull out my card.  (That’s a debit card, thank you.)  And, that’s the reason that retailers will have LTOs.  Put under the pressure of a deadline, people will often put off doing the research they should and purchase on the spot to take advantage of a great deal.

How I Practice Patient Purchasing

Patient purchasing has probably saved me thousands of dollars over the years.  Here’s the method that I generally use.

  • Decide on the brand and model that you want.  This can be the super heavy duty research part of the purchase.  I’ll spend time shopping for the item, and then looking online at retailers to find a brand and model that I like as well as get an idea of the average price of the item.  e.g. when I last bought a pair of shoes, I first decided on the brand that I wanted to buy (New Balance) and then on the model.  Deciding on the model took the most time as they have many models that are built for different strides, pronations, etc.  I also found that the full retail for a pair was about $125, but that there were discount retail outlets that regularly sold them for about $100.
  • Set up a search on eBay.  I like eBay.  It gives me the ability to fine tune a search and then save it.  I also very rarely find that the price that I can get something for on eBay is more than what I can get it for at a retailer.  Most of the time it’s quite a bit less.  I usually start with a pretty generic search for the brand and model of the item I’m looking for and then fine tune it based on the other qualifications I’m looking for.  e.g. in the case of the shoes, I started with a search for “New Balance 757” and then refined the search with the shoe size, width, and maximum price I was willing to pay.
  • Exhibit Patience.  This is the part that some people find to be really hard, but that I find comes pretty easily.  I wait.  I check the saved search every two or three days (auctions can be run in 1,3,7, or 10 day lengths, but I’m willing to miss a few of the 1 day auctions) and add items that look like good possibilities to my watch list.  I then sort my watch list by the auctions that are ending soonest, and will place a bid on the first one for the maximum that I am willing to pay.  That usually involves figuring out how much shipping will be, subtracting it from the max I’m willing to pay and then bidding the remainder.

Using that method, I can usually get an item that I want at a price that I want.  Being patient is key though.  Sometimes it can take me weeks to finally win an auction.  In the example I used above (shoes), I think it took me about 3 weeks to get a pair of shoes that I wanted at the price I wanted.  In the end, I paid just under $60 (including shipping) for a pair of shoes that I would have paid about $125 for at a retail shoe store.

Is the savings I got worth the time I put into it?  If you break down the savings and figure out an hourly savings based on the amount of hours I put into getting the shoes, it would probably not be a very good rate.  Below minimum wage for sure.  But, for the most part, the time I spent on it is time that I likely would have wasted on watching TV or something anyways.  In other words, it was non-productive time and therefore had little monetary value associated to it in the first place.  I got a new pair of shoes, and saved money doing.

Are you a patient purchaser?  What are your methods for buying bigger ticket items?

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Capitalism Requires Participation

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I recently had a small discussion on Facebook with Glen, of Free From Broke.  It started when he mentioned in his status that he had been at the doctors office waiting on his appointment for 44 minutes.  He asked if he should just say to heck with it and reschedule the appointment.  I suggested that he wait it out, then send the doctor a bill for his time spent waiting.  Most people, when I make a similar suggestion, think that I’m joking.  That’s only half true.  I honestly think that if you’re waiting for a long enough time, you ought to send a bill.  I’m not the only one, either.  Check out this article, and this one on CNN.

Now, I’ll be completely honest.  I’ve spent plenty of time waiting on doctors, dentists, and the DMV.  I’ve never once sent a bill.  I’m chicken.  🙂  Really, I think that we’re preconditioned to expect that we’ll wait for a doctor, and since we’re paying them for the service, and we need the service, we don’t dare rock the boat.  But, there’s a couple of good arguments against that being true.  The biggest of which is that capitalism requires participation.

An economic system characterized by private or corporate ownership of capital goods, by investments that are determined by private decision, and by prices, production, and the distribution of goods that are determined mainly by competition in a free market.

Merriam-Webster

Capitalism and the Free Market

In particular, I’d like to point out the last part of that.  “determined mainly by competition in a free market”.  What drives that competition, and as a result, the free market?  The law of supply and demand.  In the law of supply and demand, the prices of goods and services are determined by the supply that exists for a good or service, and the demand that exists for that same good or service.  If demand is high for something, and the supply is low, or limited, the people who have the supply can charge more because the ratio of supply to demand is higher.  But, what about something like a doctors visit?  Doctors aren’t exactly in a low enough supply to warrant higher prices.  While our insurance companies are able to negotiate cheaper prices for services with a doctor, we very rarely will even ask if there’s a better rate.  And, we’ll willingly sit in a waiting room for extended periods of time, which, anyone familiar with the concept of time cost will tell you, costs money.

Participating in Capitalism

In order to change that status quo, we need to start participating in our capitalism.  The clinics and hospitals that many of the doctors work at are requiring their doctors to schedule appointments in 15 minute or 30 minute increments.  How many times have you gone to the doctor and spent more time than that in the exam room?  I know I probably do at least every other time.  Obviously, that’s not a very efficient way to schedule the time.  But, they do it so that the doctors can squeeze in as many patients as possible.  It’s ruled by profit.  The more patients a doctor sees in an hour, the higher the profit is for the clinic.  They’ll never change that unless the profit starts to go away.  How does the profit go away?  Well, either the doctors become so expensive that they’d have to see many more patients in a day than physically possible (they’d just raise rates), or they start getting bills for the patient time they are wasting.

If patients begin billing for the time they spend in a waiting room, eventually, it becomes more expensive to keep patients waiting than it does to change the way they schedule appointments.  Consider the last time you had cable hooked up in your home.  You likely called the cable company to set up an appointment, and they gave you a 4-5 hour window when the technician would be there.  What if you then told them that your time is valuable to you, and that they can expect a bill for every half hour past the beginning of that window that you’re kept waiting on the technician?  Do you think he’d make you wait the full 5 hours?  Not very likely.

The prices of goods and services, including the time those services take to perform, are determined by what the market will bear.  As long as the market continues to pay the cost of the goods or services, the provider can continue to charge that price.  Sometimes they’ll start increasing it.  But, when we begin to value our time, and hold service providers accountable for the cost of time wasted waiting on them to perform a service, we can begin to tell those providers that the market will no longer bear the cost of lost time.  In short, we begin to participate in the free market economy we call capitalism.

Would you ever bill a service provider, doctor or otherwise, for time spent waiting on them?  If not, is it because you don’t value your time, or because you believe that the service provider is truly doing all they can to proved the best services?  Is the service providers time more valuable than yours, and that’s why you won’t bill for your time?

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Saving On Eyeglasses

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If you’re one of the people who needs them, eyeglasses can be one of the most expensive medically necessary things you will have.  Unless you need some other fancy piece of equipment, your eyeglasses can cost several hundred dollars up to a thousand dollars or more if you decide to go with the name brand fashion designer frames.  (If you’re reading this blog, I fully expect you wouldn’t, but we all know there are those that do!)  Before I go much further, I must admit to not being one of those people who needs eyeglasses. (yet.)  I have, so far, been blessed with good vision and very few problems as far as my eyes go.  My wife, on the other hand, is not so lucky.  And, if either of the kids takes after her in the vision department, we’ll be looking at some not-so-fun expenses in the future.

Some people will go to the optometrist, get their prescription, and then order their lenses right on the spot.  And, most of those people will spend a whole lot more for their lenses and frames than they really should.  Depending on how often your prescription, and thus your lenses, changes, you might be buying new lenses and frames on a pretty regular basis.  Add it all up, and the expense can be enough to make you actually consider cutting off the bottoms of coke bottles and super-gluing them to some bent coat hanger wire.  Attractive image, no?

What should you do to save some money on your eyeglasses?

Eyeglasses on TableStart by shopping around.  Just because your optometrist is your eye doctor doesn’t mean you need to purchase all of your eye related devices there.  The doctor already has gotten paid for the visit.  No other compensation for their time and the visit are necessary.  Most towns will have at least two optometrists, and bigger cities will likely have 10-20 or more.  Bigger cities may also have at least one of the new discount eyeglasses stores that have been popping up recently.  Take your prescription home, then call a few of them and ask about prices for the eyeglasses you need.

Take your business online.  If you know what style of frames you want, there are several places where you can purchase prescription glasses online.  Places like Glasses.com (run by the same company that runs 1-800-Contacts), can offer discount prices on eyeglasses because they don’t have as much overhead as many physical retail stores have with employees.  Also, because they aren’t in a physical location, they can tap into the wider customer base of the internet and get bulk discounts on the glasses that they pass along to the customers.

One last place to look that many people forget about are warehouse and membership stores.  Places like Costco and Sam’s Club usually will offer discounted glasses to their members.  Even some Walmart supercenters have vision centers in the building and can offer a better price on glasses because of their size and purchasing power.

Eyeglasses are an important, and often necessary, thing that many people will use over their lifetime.  As your prescriptions and tastes change, you’ll want or need to pick up new pairs of glasses.  Shopping around, both locally at other optometrists and at warehouse stores, and online has the potential to save you hundreds of dollars on your next pair of glasses, and thousands over your lifetime.

Use the money you saved to help pay off a credit card or some other debt!

What other tricks, tips, and hints to you have for saving on eyeglasses?

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