Money-savvy people agree: building up savings is not only important for our financial health and helps us prepare our future, it makes us feel good about ourselves.
But for this to be true we need to save well, without jeopardising our future and focusing on long term benefits. And so we need to learn to stay away from what I call “fake savings”. Have you ever bought a product at an irresistible low price that ended up costing you much more due to bad quality and issues post-purchase?
Technology – victims of our own savings efforts
Every day, consumers across the world acquire cheap household appliances or technological items sold at a price that is “too good to be true”. It very often is! Retailers set the price so low it’s difficult for us to bypass our limbic system (the part of your brain that houses our emotional life) and not acquire the product, especially online where we fool ourselves and try to rationalise the “fake savings”. The rude awakening happens when we open the box and discover the truth: loose cables, dead batteries, frail screens that break just by looking at them and buttons that disappear into the belly of the beast… The neocortex (you probably already guessed that’s where conscious, rational thought happens in the brain) turns on and the what-was-I-thinking? discussion with your inner voice commences...
Maintenance costs and expensive consumables
Good quality consumer goods can also lead to “fake savings”. Think of a printer: expensive laser printers use much less ink in the long run than ink-jet printers, which are much cheaper if we only compare the initial investment. Having to renew pricy cartridges regularly might turn up costing us more in the long run. Other examples are cheap items of clothing that are ruined in the first wash; shoes whose soles wear out after only a few weeks; cheap repair works that require a second or even third intervention…
Planned obsolescence – driver of our economy
Low-price items have a shorter life span than their pricier competitors. This is partly due to the planned obsolescence (or built-in obsolescence) of the product: after a time it will break down, become obsolete or unfashionable and we’ll have to replace it, i.e. purchase and thus inject money in the economy – but diminish our savings. Another reason is cost-savings in the design or R&D to build the product, and also disposable or single-use products. An example of the latter are single-use batteries: we all keep buying them although rechargeable ones are much better for our pocket, and our environment!
True savings
So the key is to save well. With a plan, committing for the long term, without difficult sacrifices or extravagant excesses.
Being a good saver is not synonym of being cheap! False savings, like in nutrition, can affect our health – on we should never skimp! Running or buying a bicycle can help us build up savings and exercise. Planting herbs and vegetables in our garden can save some money and contribute to a healthy diet. Using public transport is good for our pocket, for the environment, and might allow us to arrive home rested after a tough day in the office.
Avoid fake savings. Be good at money!
