3 common buyer’s remorse purchases (and {how to prevent} them)

So you spent {a little} pile of money on something you THOUGHT you wanted – {and then} realize later {you might have} gone without it.

Congrats! You have buyer’s remorse. It’s not fun BUT {you can find} {methods to} prevent it. {I wish to|I would like to} {demonstrate} how.

Wrong Way Sign

What is buyer’s remorse?

Buyer’s remorse {may be the} feeling of regret {you obtain} after {creating a} purchase.

Having devoted {my entire life} to helping {people who have} personal finance and development, {the topic} fascinates me to no end. Why do people {buy things} {they} regret?

So {some time} back, I posed the question to my followers on Twitter. After {studying} {all the} responses, I’ve {discovered that} buyer’s remorse typically happens after BIG purchases. {The most typical} are:

  1. Buying a house
  2. Buying a car
  3. Getting a degree

That’s why {I wish to|I would like to} go through {each one of these} purchases with you and {demonstrate} exactly how {it is possible to} avoid buyer’s remorse for them. Later, I’ll also {demonstrate} {how to proceed} if you’ve already made a purchase you regret.

Bonus: Having {several} {blast of} income {will help you} through tough economic times . {Learn to|Figure out how to|Discover ways to} start {making profits} {privately} with my FREE Ultimate Guide to Making Money

Big purchase #1: {Investing in a} house

Buyer's Remorse Example 1 - {INVESTING IN A} House In 2008 On A Whim

Aside from {things such as} marriage or having kids, {investing in a} house {may be the} biggest decision {the average} person {can make}.

And yet, I’m amazed at how lightly people {treat it} when they’ll obsess over {things such as} {eliminating} lattes {to save lots of} money.

They’ll rush {involved with it} without much research or considerations to the alternatives … why? Simple: It’s an invisible script – a guiding belief so deeply ingrained in society and culture {that people} don’t even realize it’s there.

When {the simple truth is} {you almost certainly} don’t {have to} {purchase a} house. Don’t {trust me}? {Here are a few} of {the largest} myths surrounding real estate:

  • “I’m {throwing out} my money {easily} keep renting!” WRONG. {Individuals who} say {things such as} this don’t {look at the} “phantom costs” of {running a} home. Those are {things such as} home maintenance and repairs, property taxes, insurance, HOA fees, and utilities that fall {on your own} shoulders {to handle} {once you} own. Home values {could also} not rise enough {to provide you with} the equity {you anticipate}.
  • “{I could} {make use of the} tax savings!” This doesn’t even make any sense. {Even though you} deduct {adequate} your mortgage interest {from your own} taxes, you’d be deducting money you’d ordinarily never spend.
  • “{Property} {is an excellent|is a good|is a superb} investment.” False. Yale economist and Nobel laureate Robert Shiller {found that} from 1890 to 1990, the return on residential {property} was about zero after inflation.

You {may have} been told {that you should|you need to} {purchase a} house after college or {once you} get married. {The truth is} there isn’t {the right} time that’s {best for} everyone. {There could} never {be considered a} time {for you personally} – and that’s okay.

If {you imagine} {you truly} DO {need it} {a residence} though, {be sure you} {have a look at} my articles on how {to get} a house and real estate investing myths {to ensure} you’re making {the proper} decision.

Big purchase #2: {Investing in a} car

Buyer's Remorse Example 2 - Buying More Car Than {YOU WILL NEED}

One of {the largest} reasons {investing in a} car {can change} {right into a} HUGE case of buyer’s remorse: People don’t buy for the {long term}.

Instead, they get {swept up} in {things such as} how flashy {the automobile} {will undoubtedly be} and how good it looks. They treat {an automobile} as a status symbol {rather than} {solution to} get from point A to point B.

If {you would like to|you need to|you wish to} {purchase a} car {you have to|you should} prioritize {obtaining a} reliable car that you’ll {have the ability to} drive for {at the very least} {ten years}.

Cars {certainly are a} long-term purchase. They {are expensive} of money. That’s why you’re {likely to} {need to get} {one which} lasts {some time}, since it’s only {likely to} {worsen} and less valuable {as time passes}.

Flashy vs Reliable Car Happiness {AS TIME PASSES} Graph

If {you need} even more {home elevators|info on} {investing in a} car, {make sure to} {have a look at} my best articles on {this issue} below:

Also {make sure to} {have a look at} this video where I {demonstrate} how to {purchase a} car the Ramit way.

Bonus: {Desire to} finally {strat to get} paid what you’re worth? I {demonstrate} exactly how {in my own} $37,000 in debt. It’s even more than that for post-graduate education.

These numbers can seem insurmountable. BUT there’s hope. There’s actually {something} {to assist you} pay off {your financial troubles} painlessly.

How? Pay more {every month}.

This {may seem} counterintuitive, but it’s true. {Student education loans} are huge amounts spread over {an extended} {time frame}. {So that you can} save {quite a lot of} {money and time} by {paying down} a little {every month}.

Imagine {you’ve got a} $10,000 {education loan} at a 6.8% {interest} with a 10-year repayment period. {In the event that you} go with {the typical} {payment}, you’ll pay around $115 {per month}. But look at {just how much} you’ll save in interest {in the event that you} just pay $100 more {every month}:

MONTHLY PAYMENTS TOTAL INTEREST PAID YOU SAVE
$115 $3,810 $0
$215 $1,640 $2,170
$315 $1,056 $2,754
$415 $728 $3,082

From the chart above, {in the event that you} pay just $100 more {per month}, {you can} save $2,170 {on your own} {student education loans} and shave time {from} your {student education loans}.

For more insights on {paying down} your {student education loans}, {make sure to} {have a look at} my video addressing a reader question about {that}.

Of course, {it is possible to} prevent buyer’s remorse for college {in the event that you} don’t {need to} {shell out the dough}. That’s what {I did so} when I developed {something} that helped me {earn much more} than $100,000 in scholarships for Stanford.

How do I prevent buyer’s remorse?

As the adage goes, prevention {is preferable to} the cure. And there’s {an excellent} solution for {if you need to|in order to} prevent buyer’s remorse: Only {purchase} things that {you like} – and {your investment} rest.

This {can be} {referred to as} a Conscious Spending Plan, {also it} {could help you save} money for {the items} {you like} and live your Rich Life.

I have {a pal} who leverages this to great effect by spending over $21,000 {per year} partying and {venturing out}.

I can already hear {a few of} you screaming from here … but it’s true. Let’s say he {is out} just four times {weekly} to dinners and clubs and spends $100 {every night} (conservative estimate for {my pal}). That’s $400 {weekly}!

At first glance, {this may} seem ridiculous. However, {everything you} don’t realize is he makes {a wholesome} six-figure salary. He’s also invested {a whole lot} into his 401k and his diversified portfolio of investments.

So say he makes $210,000 {per year} net. {Which means} his going-out money {makes up about} about 10% of his income – {that is} totally reasonable.

If {he’s got} {the amount of money}, and {venturing out} makes him happy, why shouldn’t he {have the ability to} {purchase} it?

That’s {exactly the same} framework {you may use} {once you} create {your personal} Conscious Spending Plan.

Setting up {one’s body} {is easy} too. It’s {about}:

  1. Automating your finances
  2. Knowing where {your cash} goes so you’re in complete control of the situation

Automating {finances} allows {one’s body} to {do the job} and passively do {the proper} thing {rather than} you constantly wondering {in case you have|for those who have|when you have|should you have} enough money {to invest}. Or, {getting the} {charge card} bill {every month}, shrugging, and saying to yourself, “Yeah, {I assume} I spent that much.”

And it’s simple: {at the start} of the month, {once you} receive your paycheck, {the amount of money} is immediately {delivered to} where {it requires} {to undergo} automatic systems {you have|which you have} {setup|create} already.

Some spending {tips for} {one’s body}:

  • 50%-60% fixed costs: {This consists of} {things such as} utilities, rent, internet, and debt.
  • 10% investments: {This consists of} your Roth IRA and 401k plan.
  • 5%-10% savings: {That is} money that goes towards {things such as} vacations, weddings, home down payments, and unexpected expenses.
  • 20-35% guilt-free spending: Fun money! Spend this on {whatever you} want from nice dinners to movies.

Why automatic?

Because as humans {we’ve} incredibly limited willpower. It’s so limited {actually} that {it could} render {things such as} paying bills and putting money away in your savings {every month} a very {trial}.

Automating {finances} subverts this by {enabling you to} {cut costs|spend less} without ever {needing to} {do-it-yourself}.

If {you would like to|you need to|you wish to} {learn more|get more information} {on how best to} automate {finances}, {have a look at} my 12-minute video explaining it here:

Bonus: {Prepared to} ditch debt, {cut costs|spend less}, and build real wealth? Download my FREE Federal Trade Commission).

When you {create a} purchase during {among the} above instances, {ensure that|be sure that} your seller {offers you} a cancellation form for {in addition to a} receipt. {This way} if you {find yourself} with buyer’s remorse, {it is possible to} send them the cancellation form within three days.

After which, {owner} has 10 days to refund {your cash}.

Of course, this rule is pretty specific and doesn’t {connect with} big purchases like homes and cars. However, {it could} {can be found in} handy in {the aforementioned} situations.

If {THE GOVERNMENT} can’t {give you a hand} though, {you may be|you could be} {in a position to} turn to {your own private} {charge card} army {to assist you}.

Credit card protection

Credit cards {get yourself a} bad rep – and {once and for all} reason. However, if you’re a responsible {charge card} owner, {there are always a} ton of hidden benefits and perks {it is possible to} leverage.

One {of the greatest} benefits: {Charge card} protection.

When you {create a} purchase that you’re {unhappy} with, your {charge card} will fight {for you personally} {to be able to} help get {your cash} back.

For example, I canceled my {cellular phone} plan {some time} back and got charged a $160 “early cancellation fee” – {that was} weird because I had already negotiated out of a cancellation fee when I signed the contract.

So I called {the client} service rep for {the telephone} company, informed them {of the}, {plus they} said they wouldn’t charge me … {however they} {achieved it} anyway.

That’s when I {made a decision to} call my {charge card} company and {inform them} {I needed} to dispute the charge. {Do you know what} happened?

Two weeks later, the complaint was resolved {in my own} favor.

Moral of the story: Your {charge card} company is {working for you} {with regards to} disputes. {Actually}, the {charge card} company fights the merchant {for you personally}.

A La Carte Method

This {is an excellent|is a good|is a superb} method to {cut costs|spend less} on services {that you} have a subscription, like:

  • Netflix
  • Gym memberships
  • Spotify
  • Amazon Prime
  • Magazines

A conservative estimate {demonstrates|implies that} we spend over $1,800/year on subscriptions alone.

The convenience is undeniable BUT {it is a} case {where in fact the} convenience also works against you.

Take a gym membership {for instance}. {Perhaps you} haven’t {gone to} {the fitness center} in {some time}. {And that means you|Which means you} feel guilty that you’ve been paying money for {a pricey} membership {on a monthly basis} but you still {keep carefully the} membership because that’s easier than saying you don’t actually {utilize it}.

Read that again. It’s {the main element} to cutting your spending {during your} subscription items you’re {most likely not} getting {quite definitely} value out of.

Which {is the reason why|is excatly why} {I would recommend} the A La Carte Method.

The basic {notion of} this system {would be to} cancel {all of your} discretionary subscriptions – magazines, Spotify, Netflix – {and purchase} {the thing you need} a la carte.

  • Instead of {spending money on} {a huge amount of} movies and shows you’ll never watch on Netflix, buy only the {teaches you} {desire to} watch on Amazon or iTunes for $1.99
  • Buy {each day} pass for {the fitness center} {every time you} go (around $5 – $10)
  • Buy songs as {you need} from Amazon or iTunes for $0.99 each

This FORCES {one to} be conscious {together with your} spending. {Through the use of} {exactly the same} principles {that produce} automating {finances} great, {you will need to} actively {consider} each {ask you for} make {with regards to} {investing in a} song or {Television show}.

If after about {8 weeks}, {you’re} spending enough money on {these things} to justify the subscription, {you should} pick it up again. {Or even}, then you’ve saved yourself from some major buyer’s regret.

Earn {additional money} {for just about any} purchase

The best antidote to making any purchase without regret is {getting the} money {to invest}.

That’s why I created something {for you personally} that {I believe} you’ll {enjoy}: The Ultimate Guide to Making Money. 

In it, I’ve included my best {ways of}:

  • Create multiple income streams {and that means you|which means you} always have {a frequent} {way to obtain} revenue.
  • Start {your personal} business and escape the 9-to-5 {once and for all}.
  • Increase your income by {thousands} {per year} through side hustles like freelancing.

Download {a free of charge} copy of {the best} Guide today by entering your name and email below.

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