Sign Up Help Bill Pay Demo Forgot Your Password?

   

HOW TO AVOID SETTING FIRE TO YOUR BUDGET WITH AMAZON

Amazon’s new smartphone, the Fire, has everyone raving. Among its features is “Firefly” technology, which allows you to take a picture of something, press a button, and then immediately translate that into digital information. Amazon boasts that this app will let you instantly capture names, addresses, and phone numbers for future reference. And, of course, it also includes an app to make shopping easier.

The Fire phone will be available for purchase July 25thand is fully integrated with the Amazon ecosystem. Included in the purchase price are a year of Amazon’s free shipping program, Prime, as well as 30 days of free streaming for video and music from the online retail giant. The Fire encourages people to buy something every time they touch their smartphone. For most people, that translates into a lot of opportunities to impulse buy.

If your Amazon experience is like most people’s, the last thing you need is a way to make it easier to spend money there. Amazon is already the master of distancing you from your money. It’s easy to buy stuff you don’t really need and blow through your budget in a big hurry. So can you take advantage of the convenience of their new technology without giving in to their powerful marketing apparatus? Let’s look at 5 tricks to help keep you from going broke on Amazon.

1.) Budget for your impulse buys. Think of budgeting just like you might for dieting. If you’ve ever set an impossibly restrictive diet, you know it works great for a few days until you snap and eat an entire sleeve of cookies. The same is true when you set an incredibly restrictive budget. It’ll work until you have a bad day and indulge in some “retail therapy” or see an impossibly good deal on the latest cellphone accessory that you “have to have”. You need to build room into your monthly budget for a few discretionary purchases on clothes, gadgets, or whatever it is you regularly drool over. You will make a more realistic plan when you account for your existing shopping habits. Encourage yourself to stick with your budget by linking an Amazon gift card to your account instead of a credit or debit card. That way, you can only spend the amount you have in gift cards.

2.) Think about the price in three different ways. The power of Amazon’s “buy it now” feature is that you only think about the money in an abstract way. This is the same reason slot machines use “points” or “credits” instead of dollars. You only think of a purchase decision in terms of the abstract dollars it costs and the goods for sale. Thinking in these abstract terms increases your likelihood to spend recklessly. Take a moment to think about that money in terms of a few different options. That $19.99 is a day’s groceries, a night at the movies, or a fast food meal for four. Compare how much you want the thing you’re considering to how much you want the other things you could do with that money. By taking this moment to think about your purchase, you can cut down your impulse buying and maximize the happiness you get with your dollars.

3.) Be careful with the information you give Amazon. While data security isn’t a huge concern for the massive retailer, most of its commercial success is based upon repeated exposure to products you express an interest in. Use incognito mode when browsing Amazon from your computer. This will prevent them from recording your browsing and repeatedly exposing you to items that will tempt you.

4.) Partner up with a friend. Find someone else who has trouble with impulse buying and form an agreement – neither of you will buy something without explaining your reasoning to the other. The act of verbalizing our reasons helps us to make better decisions and avoid impulsive actions. If you wouldn’t bother your friend over it, you don’t really need it.

5.) Use the 24-hour rule. For every purchase, wait one day before you buy it. You’ll remember and think more seriously about things you actually need or would use. You will tend to forget about things that you were considering buying “because they were on sale” or “because they look cool.”

Sources:

http://www.pcmag.com/article2/0,2817,2459934,00.asp 

http://america.aljazeera.com/opinions/2014/6/amazon-new-fire-phoneshoppingconsumerprivacy.html 

http://www.huffingtonpost.com/alistair-goodman/amazons-master-of-commerc_b_5525445.html 

http://bgr.com/2014/06/18/amazon-fire-phone-release-date-specs-announced/