StopBuyingCrap.com

Every year, the swell people at the United States General Services Administration produces the Consumer Action Handbook, which AARP likes to call “Uncle Sam’s bible for the buyers.”

Indeed, if you read through the entire book, you will most likely become the Gandalf of savvy consumers (didn’t he die at the end or something though?). Here’s 13 quick tips from the handbook, in case you’re curious, and also in case you have a 1996 PC that crashes whenever you load Adobe Reader 3.0.

1. A deal that sounds too good to be true usually is! Offers that often fall into this category are promises to fix your credit problems, low-interest credit cards, deals that let you skip credit card payments, business/job opportunities, risk-free investments, and free travel.
2. Extended warranties or service contracts are rarely worth what you pay for them. See page 2 of the handbook for questions you should ask before you say yes to one of these contracts.
3. Say no to credit insurance offers. Often offered with credit cards, car loans, and home mortgages, it is almost always better to purchase regular property, life, or disability insurance.
4. There is no universal three-day cooling-off period. Don’t be me misled into thinking that you have an automatic three days to cancel a purchase. Only a few types of contracts give you a right to cancel.
5. Think twice before sharing personal information. Protect your privacy and avoid unauthorized use of your personal information by following the advice on page 39 of the handbook.
6. Beware of payday and tax refund loans. Interest rates on these loans are usually excessive. Even a high-interest cash advance on a credit card could be better option.
7. Not all plastic cards offer the same protections. Your liability for the unauthorized use of a gift card and debit/ATM card may be much higher than the $50 maximum on your credit card.
8. Real estate agents represent the seller, not the buyer. When buying, consider hiring an agent or lawyer who represents you.
9. Home improvement and auto repairs are the subject of frequent complaints. Second opinions are especially important when you are dealing with a repair service you do not know.
10. Think twice before you rent-to-own. Interest rates on rent-to-own purchases can be very high. If you miss a payment, you could end up with nothing. Consider other options such as buying second-hand at a thrift shop or through ads in your local newspaper.
11. Don’t buy under stress. Research suggest senior citizens, people in crisis (e.g., coping with a death or debt), college students, small business owners, minorities, and immigrants are especially at risk of being victimized. Avoid making big-ticket purchases during times of duress.
12. Be cautious of “Buy Here, Pay Here” lots. If you decide to buy a car from a used car lot, be sure to read all the papers before you sign. Don’t sign contracts that allow the dealership to change the finance rate AFTER you leave the lot.
13. Work-at-Home ads usually don’t pay off. Be especially wary of ads that promise huge annual salaries; they often require expensive upfront fees with no guarantee. You risk losing your money and wasting a lot of time and energy.

photo credit: Lloyd Budd