DRMC Employee of the Year - 380Guide Magazine

90 Days is not
the Same
as Cash
We have all been there. You walk thru an electronics store
looking at all of the toys and suddenly it hits you. You
NEED a big screen TV. Never mind the 4 other TV’s that you currently
have at home that you haven’t watched in some time. Then you see those
magic words “90 Days Same as Cash”. You are certain this is a sign that
you have the green light to buy. With the money that you will save on
interest, you can’t afford not to buy it. After all haven’t you always heard
it is smart to use OPM (Other people money)? You get free use of their
money for 90 days and you can keep yours in the bank earning that
whopping 1.5% interest.
CELINA CHRISTIAN
ACADEMY
Fitting Into
God’s Plan
24 www.380Guide.com
www.CelinaChristian.org
841 N. Preston Road * Celina, TX 75009
972.382.2930
Maybe you don’t have the money in the bank, but you are sure that
within 90 days you can scrape up enough money to pay the TV off. Do
you know what happens if you miss a payment or you pay the balance
off on day 91? You get charged interest, sometimes huge interest and
maybe some penalty with it. Statistics show that 70% of the “same as
cash” contracts don’t get paid off within the allotted time. Whether it is
for 90 days or for 1 year with no interest, 7 out of 10 people still end up
paying the interest.
Oh but I am the exception to that rule you say. Hmmmm, any
worries about layoffs at work? Think that gas may not double in price
from where it currently is which would strain your budget? What about
that money in the bank? Have you ever experienced an emergency that
drained your bank account like a vehicle repair or medical emergency?
There is some risk isn’t there?
How about this idea? Save the money and just pay for it. Why take
that risk of having to pay the interest? If you don’t have the money now,
have you ever thought about saving for the TV first and then going to
buy it? If you could pay off the loan in 90 days it should be no problem
in saving the money in 90 days. Here is another reason 90 days is not the
same as cash, discounts. If you have cash you can negotiate. Now we are
talking about saving some serious money. A client of mine’s daughter
needed braces. The total cost was $2200 and the Orthodontist was
offering no interest for 6 months. That’s a little over $350 dollars per
month and was something that my client could afford in his monthly
budget. We talked about the options and the client ended up waiting the
six months and saving the money to pay cash but that is not the end of the
story. He was able to walking in with 18 crisp Ben Franklins and offered
all cash up front for his daughter braces. Guess what? The Orthodontist
accepted it for a $400 dollar savings! Another client of mine had her air
conditioner go out and because of the age of it, she needed to replace the
whole unit. She called me to help her re-do her budget so that she could
afford the over $800 (same as cash) monthly payment. She actually had
the money in the bank to pay for the replacement unit but didn’t want
to use it because of the “no interest” offer of the A/C Company. After
some discussion she offered them less cash and saved over $200 off the
price of the new A/C. Before you make your next purchase, whether it is
a “want” or a “need”, check all of your options and see how you can get
a better deal plus save some of your hard earned cash. As you can see,
90 Days is NOT the same as cash.
Brad Cason - Cross Focus Financial Coaching
www.crossfocusfinancialcoaching.com