In This Chapter

Most teenagers—most everybody, for that matter—have limited amounts of money to spend. That’s why we need budgets (remember Chapter 10, “Budgets Are for Everybody”?) to help us spend our money wisely, and discipline to help us hang on to some of that cash we’d like to spend on all the good stuff we see every day.

The issue, then, is how to be smart about spending the money you have. You want to make the most of your money, right? Let’s say you have $50. That might sound like a lot until you get into Bloomingdale’s and find out there’s not a sweater on the rack for less than $48, or that it’ll barely be enough for an afternoon on the ski slopes with a burger afterward.

So, how are you going to get your money’s worth, no matter how much moola you have? If $20 is all you have, you’d better be darned sure you make the most of it. Ditto for $100, $500, or $1,000. People who are financially savvy make their money work for them, no matter how much of it they have. In this chapter, you learn how to make you money work for you and how to make the most out of what you have.

Choices, choices, choices. There are so many things to want, and so little money with which to buy. But, that’s okay; there are some easy guidelines to follow when shopping that will help you make smart choices when deciding what to buy.

Picture this: You’ve just seen something in a store that you consider an absolute must-have. You know you’re not going to be able to live without it. You check your wallet and, sure enough, you have enough money to buy whatever it is that has you so excited.

Before you rush over and tell the salesperson to get it out of the case and ring it up, take a few minutes to consider what you’re doing and whether or not it’s really a good idea to buy the watch, the shoes, the CD, or whatever it is that you’ve fallen for.

Ask yourself the following questions:

If you think about these questions and answer them honestly, you’ll have a good indication of whether or not you should buy the item in question. If you said “yes” to questions 1, 2, 3, 4, and 6, and “no” to questions 5, 7, and 8, chances are this is a good purchase for you.

Your “yes” answers to questions 1 through 3 indicate that you either need or really want the item, and you’re sure that you’ll use it. A nod to question 4 means that you won’t be overspending on this item and have no money left for the rest of the week. And, saying “yes” to question 6 indicates that there’s reason to buy the item now instead of waiting. Maybe it’s a one-of-a-kind thing and there are no replacements.

Saying “no” to question 5 tells us that you have enough money to take care of paying what you might owe. And answering in the negative to questions 7 and 8 indicate that the item you want isn’t available for less someplace else, and won’t be going on sale in a few days or weeks. That being the case, go for it!

Sometimes, after giving some thought to the question of whether or not to buy something, you’ll decide to let it go. Maybe you know you don’t really need the item, and once you think about it, you realize that you’re not all that crazy about it. Maybe you’ve seen the same thing someplace else for $10 less or you figure it’ll be on sale by the end of the month.

You might be a little concerned about your money situation now and not see the need to make things worse by buying on impulse. If you’re unsure about buying something, usually the best thing to do is to let it go. Tell yourself that you’ll think about it and come back tomorrow if you still think you want it. You might even ask the salesperson to hold the item for you, just in case you decide you really can’t live without it. Chances are if you leave it at the store, you’ll come to the realization that you don’t need whatever it is you’re considering.

To get the most from your money, you’ve got to know when to buy as well as what to buy. Some things, such as peaches, tomatoes, and sunscreen, are best bought in season. Other things, such as winter coats, bathing suits, and airline tickets, are best bought out of season.

In season, you can buy a basket of sweet red peppers at a farm stand for $3. A basketful of the same in January, however, could cost you 10 times that much.

The same idea goes for the sunscreen that was mentioned earlier. If you’re going to Florida for spring break, wait until you get there and hit the local discount store. It’ll have all kinds of beach stuff, and you won’t have to pay a fortune for it. Trying to find sunscreen in the middle of March in New Jersey can be like trying to track down a bikini at the North Pole on Christmas Eve. When it comes to produce and other truly seasonal items, shopping in season is best. Some other things, however, are best purchased out of season.

Here’s the deal. It’s late March, and you swing into your favorite shop to buy a new fleece jacket in a spring color. Your best friend got a hot pink one last week, and your brother’s girlfriend just showed up with a great turquoise-colored one.

While you’re in the store, you notice that the heavy winter jackets are on sale—big time on sale—like 75 percent off. You can actually buy a warm, but very cool winter jacket for less than you were planning to pay for the spring fleece. And the thing is, you really need a winter coat. The one you wore this season was tight enough to be uncomfortable, not to mention embarrassing because it looks like something your younger sister would wear.

So, what do you do? Buy the winter coat at a steal price and leave the spring jacket? Or buy that pale yellow fleece that will look great with your new jeans on your class spring trip? Take a minute and think about this scenario. Take another minute. Okay. It’s time to come out with an honest answer. What would you do?

If you said that you’ll buy the winter coat, good for you! Pat yourself on the back and step into the thrifty shopper club, but if you know deep down that you’d buy the fleece and worry about a winter coat when next fall rolls around, you’re in good company.

Let’s face it: It’s hard to think winter coat when the daffodils are blooming outside. You’re looking forward to the activities that spring brings—not thinking about being warm next winter. But think about how smart you’d be to buy the winter coat now. Think how great you’d feel on the first cold morning next fall when you pull it out of the closet and put it on. Think what you could do with the money you’d save by buying it now. It’s not always appealing to buy out-of-season merchandise, but it can save you significant dollars.

Now that we’ve covered how to buy, it’s important to think about where you’ll spend your money. There never have been more opportunities for buying than there are today. You can take the traditional route and head over to the mall, or you can visit one of the increasing number of specialty shops that are popping up. You can shop by catalogue and never even have to get dressed, or you can join the hordes of people who have taken to shopping online. In this section, we check out some of the advantages and disadvantages of different means of shopping and examine where you might get the most for your money.

Department stores such as Macy’s, Dillard’s, Lord & Taylor, Bloomingdale’s, Robinson’s-May, Foley’s, or Kaufmann’s, are great. They carry a variety of items—clothing, gifts, cosmetics, housewares, and stuff for kids—and they generally have pretty good service. You can return items (as long as you save your receipt) if you decide you don’t want them or have problems with them. You can go and look at what you’re thinking about buying, or try on clothing to see how you’ll look in it.

When shopping in a department store, be sure to consider sales events. That pair of pants you like that costs $43 today might be on sale this very weekend for $29.99. That new bedspread you saw for your room might be marked down 50 percent during the store’s big sale at the end of the month. Many salespeople know, and are happy to tell you, if the item you’re thinking about buying will be on sale in the near future.

Specialty shops are fun, but they’re generally more expensive than department or discount stores. Specialty shops are where you’ll find funky stuff that doesn’t show up in more mainstream stores. If that sort of merchandise appeals to you, you might do well in these kinds of store. As with department stores, be sure to check out the possibility of upcoming sales, or look for off-season merchandise.

Popular with many people, discount stores offer a variety of merchandise, typically at lower prices than traditional department stores. There are different kinds of discount stores, and prices among them will vary.

The big discount marts such as Ames and Wal-Mart can offer low prices because they buy merchandise in huge quantities. They might offer some of the same brands you’ll find in department stores, but generally the merchandise is not as high-end as you’ll find at Macy’s or Dillard’s. Other discount places offer merchandise that’s slightly flawed, or that’s from a close-out lot, or left over from the previous year. These kinds of places include T.J. Maxx and Filene’s Basement, and stores that vary locally that offer everything from beauty and health care items to discontinued wallpaper and ceramic tile.

Discount stores are becoming more and more prevalent, and offer some good bargains. Some of them also offer some good junk, so be careful.

Outlet stores cropped up for a while across the country like Christmas lights do after Thanksgiving. Many of them were included in outlet “malls,” which put various shops together in one complex. For whatever reasons, many of these outlet complexes failed and were shut down.

There are, however, many outlet stores still around, and they do offer some good shopping values. As with discount stores, outlets might offer merchandise that’s less than perfect, or that’s left over from a previous season.

Some outlets, such as the VF Factory Outlet in Wyomissing, PA, offer all merchandise at 50 percent or more off the regular retail price. The VF Corp. owns companies such as Lee (think jeans), Jansport (think backpacks), Joe Boxer (think jammies), Wrangler, Jantzen, Healthtex, and more. One of the original outlet centers in the country, it truly is a manufacturer’s outlet, and you can find great buys there.

However, beware of the outlets that are really nothing more than places to sell merchandise that nobody wanted when it was for sale at department or discount stores.

There’s no question about it, Internet shopping is hot. It’s estimated that Americans spent about $20 billion on e-commerce in 2000, most of which was attributed to online catalog sales. This e-shopping boom is causing nearly everyone to want a piece of the action. Department stores such as Nordstrom’s and Dillard’s are selling online. So are Kmart and Wal-Mart. There’s online outlet shopping, fine shopping, one-of-a-kind shopping, and of course, auction shopping.

You can buy Belgian chocolates, Holland tulips, Scottish salmon, and French films with a few clicks of the mouse. You can buy golf equipment, clothing, gifts, food, exotic pets, and nearly every kind of household item available online.

Experts predict that Internet shopping will continue to increase as consumers grow more accustomed to the idea and come to understand the many advantages of online shopping. Nearly any material item you might want probably can be found somewhere on the Internet. The selection and variety is incredible, and there are bargains if you know where to look.

There’s tons of competition among online retailers, so many are looking to give you a bargain to get you to their site. You’ll sometimes see notices of special deals when you log on to the Internet, or you can look for deals at sites such as www.mycoupons.com.

The biggest danger of shopping online isn’t the remote possibility of somebody getting hold of your credit card number or your items not showing up after you order them. Because of the sheer vastness of stuff out there, it’s really easy to get carried away. If you’re thinking of buying on the Web, it’s a good idea to set a limit of what you’ll spend. That way you can shop for as long as you’d like, but you’ll only spend within your limit.

Mail-order shopping is still popular, even though many of the catalogs now are available online. There are discount mail order companies, but many of them are pricey. The good thing, however, is that like department stores, many catalogue companies offer great prices on items that are overstocks or out of season. Don’t forget to look for these bargains.

However you decide to shop, don’t spend more money than you’ll be able to pay off at the end of the month unless it’s a major item for which you’ve planned.

When you’re looking to get the most for your money, don’t overlook the possibility of buying secondhand. Many, many apartments have been furnished with secondhand stuff. Secondhand stores sometimes turn up some funky, retro clothing and other items for cheap, cheap, cheap.

Get online to find just about anything you can imagine that somebody is trying to get rid of—computers, sports equipment, or musical instruments. You name it, and it’s probably for sale someplace on the Internet.

The danger, of course, is that it’s more difficult to know what you’re getting when you buy secondhand. Be especially wary of electronic equipment or anything else that costs a significant amount of money. If, whether you’re buying online or person to person, the seller seems in a big hurry to get rid of something, or won’t let you test out the item before you buy, it’s probably best to let it go.

Shops that sell furniture, electronics, musical instruments, sports equipment, and other secondhand items should be willing to give you a receipt when you buy. Be sure to ask about a return policy before you hand over your cash.

It’s important to get the most for your money, regardless of what or how much you’re buying. Regardless of how much money you have or expect to have someday, it’s smart to spend carefully.

Check out the Teenagers Today Web site for all kinds of tips and opportunities for saving money when shopping online. You’ll find it at http://teenagerstoday.com.

The Least You Need to Know