Your Role as a Consumer
If
you are thinking about buying a pair of tennis shoes, should
you visit every shoe store in the area? How much should you
pay for the shoes? What should you do if the shoes are defective?
Read to learn more about making economic choices.
Needs and Wants
You
and everyone around you are consumers. Consumers buy a wide
variety of things—food, clothing, automobiles, movie tickets,
and many more items. Some goods and services are needs. We need
things like food and shelter to survive. Other goods and services
are wants. These are things that help us live comfortably, but
they are not things we need to survive.
Income and Decision-Making
How much money do you have to spend and save? Education, occupation,
experience, and health can all make differences in a person’s
earning power. The graph on this page shows how much more you
could earn with a college degree. Regardless of the size of
the income you have now or will have after you finish your education,
spending that income requires constant decision-making. As a
consumer, you have a series of choices to make.
To Buy or Not to Buy?
The
first decision you must make is whether to buy an item or not.
This may sound very simple, but how many times do you actually
think about the reasons for the purchase you are about to make?
Do you really need the item? Will making this purchase mean
there is something else you cannot buy? You, your family, and
your friends are forced to make trade-offs every time you use
your money to buy one thing and not another. Scarcity
means that people do not have and cannot have enough income,
time, and other resources to satisfy their every want. What
you buy as a student is limited by the amount of income you
have. Ask yourself, "Do I really require this item? Is
there any better use for my income now?”
Making the Purchase
After you have made up your mind to buy a good or service, it
is important that you invest time in obtaining information about
the product. Important questions to consider are:
Do I want high, medium, or low quality?
Does this particular brand require more service than
other brands? If so, do I want this
additional problem and
expense?
Should I wait until there is a sale on the item I
want?
Making a buying decision involves choosing
the best-quality item that is the least expensive from among
comparable-quality products. As a consumer, you will make rational
choices when you purchase the goods you believe can best satisfy
your wants.
How Do I Pay?
When you make a small purchase, you buy it with the money
you saved. Most Americans use credit to make expensive
purchases. Credit is receiving funds to buy goods and services
today with the promise to pay for them in the future. The
amount you owe—the
debt—is equal to the principal plus interest. The
principal is the amount originally borrowed. The interest
is the amount the borrower must pay for the use of someone
else's money. Charge accounts at stores, credit cards,
and bank loans are all kinds of credit. Taking out a loan
is the same as buying an item on credit. In both cases,
you must pay interest for the use of someone else's money.
Unless you pay your balance due in full each month, you
will also have to pay finance charges.
Using Credit Cards
Credit cards provide consumers with
several advantages. They are convenient. You can charge a purchase
when you do not have cash or checks. Credit cards give you a
record of your purchases for the month, so keeping track of
where your money goes is easier. If you build a history of on-time
payments, you establish a good credit rating that will help
you in the long run.
Although credit cards are a convenient
financial tool, it is important that you use your credit card
responsibly. Keep in mind that credit cards make it easy to
make impulsive and unnecessary purchases. Institutions also
charge a much higher rate for credit cards than regular loans.
Just as you compare goods you purchase, you should "shop" to
compare the rate of interest that financial institutions
offer. Banks and loan companies compete for your business.
They charge different fees and offer different features
and benefits with their credit cards. Some have lower interest
rates, while others might offer other incentives to try
their card. By being a responsible and knowledgeable consumer,
you can enjoy the benefits of a credit card.
Rights and Responsibilities
The Attorney General of Florida is responsible
for the enforcement of the state's consumer protection laws.
Your rights under these laws include: the right to safety. This
means you are protected against goods that are dangerous to
your life and health. You also have the right to choose quality
goods and services at fair prices. All consumers have the right
to be heard. This guarantees that consumer interests will be
listened to when laws are being written. You also have the right
to redress. This means that you can receive adequate payment
in money or goods for damaged goods.
Consumers are "their own
best protection" when they exercise their consumer rights
and accept the consumer responsibilities that go with them.
Report any problem immediately. State the problem and suggest
a fair solution. Allow reasonable time to solve the problem.
Respect the rights of producers and sellers. For example,
a responsible consumer will not try to return a used item
because it has been advertised elsewhere for a lower price.
Protecting the Consumer
If you feel that a company that sold
you a faulty product is treating you unfairly, what do you do?
One option is to contact the Florida Division of Consumer Services.
This agency accepts complaints against businesses under their
jurisdiction. A comprehensive Consumer Complaints Guide is available
on-line at www.stateofflorida.com. The Florida Attorney General's
Office provides a list of tips for consumers for a variety of
products.
Many private groups and organizations also provide
consumer protection. One of the oldest of these consumer groups
is the Better Business Bureau. There are many regional and
local better business bureaus in communities around Florida.
They provide information about local businesses and warn consumers
about dishonest business practices. They also investigate
consumer complaints.
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