FOOL'S EYE VIEW
Buying Below Your Means

By Alan Oscroft
July 10, 2001

Carburton Street, London -- If any one thing has changed my spending methods beyond all recognition, it is the Internet. I keep being amazed at just how much I've grown to hate the old way of shopping.

First came the likes of Amazon.com (Nasdaq: AMZN), which remains one of my all time favourite shops. (Well, Amazon UK, actually). There may be cheaper alternatives available, but speed and reliability makes Amazon worth a few extra pennies to me and the words "books" and "Amazon" have become pretty much fixed together these days.

But how have other sites helped me?

Easier, Quicker, Cheaper

I've been in need of a new printer for my computer for some time now, but I'm a cheapskate. Trying to find one in the traditional foot-slogging manner in London just made my feet sore, and I kept leaving shops thinking "I'm not spending £100 to write a few letters now and then and to print off the occasional web page." I've searched computer sales sites too, but I generally find them confusing and their product descriptions frequently misleading.

But just the other week, feeling a sore need for a printer again, I had a browse of the Novatech site and found just the job -- a nice Epson, suitable for both Mac and Windows, for just £60. That was around £10 cheaper than I'd seen the same model anywhere else. No postage to pay either. And quick? I'll say. Afternoon, 3pm, click click. Next morning, 9 am, knock knock. 9:30 am, print print.

Auctions

I like auction sites too. Well, actually, I like eBay  (Nbasdaq: EBAY). The eBay UK site makes QXL look like an auction with not many things in it.

I'm an angler, and I'm starting sea fishing. Now, how do I buy sea fishing tackle? My local shop has a decent selection, but it's a bit pricey. Sure, they have special clearances now and then, but I'd be waiting years for just the right stuff to come around. And it takes time and money to travel around to search out other shops. But eBay has clearance items from all over the country, and it's like having lots of shops right in my home.

In the past couple of months, I've picked up exactly what I wanted at prices that were lower than I'd pay in a real shop. And I haven't even left the house to get it.

Beware the Ego

You have to get auction site shopping right, though. If you're the competitive sort and can't stand to be beaten, switch off your computer and go to the shops instead. Every time I'm on eBay I see people paying far too much for second hand stuff, letting the adrenaline get the better of them and allowing their egos make their decisions for them. (I'm amazed, for example, at the number of people who bid more for second hand power tools than I've paid for new ones).

The Secret

Internet shopping is a great tool for Living Below Your Means, but a lot of people get it wrong. It's so easy to get hooked by the technology and the huge array of nice goodies to be found, and that can lead to unnecessary impulse buying.

The way to do it is to know what you want, and to know what you're willing to pay for it. The longer you can wait the better, so planning in advance can make a big difference. Does that new shiny thing in the window cost a few pounds more than you want to spend? Don't buy it. Search around a bit more, or wait and come back a few weeks later (unlike traditional shops, the shiny thing will be just as easy to get your hands on tomorrow). There is almost always some sort of special offer going on somewhere, and the longer you can afford to wait, the greater the chance that you'll get a bargain.

And auctions? Has someone bid a couple of pounds too much for that nice bit of kit you want on eBay?  It's not a sporting competition, and you don't need to beat them. If you let other people pay over the odds while you wait until something suitable comes along at the right price, you'll be the long-term winner.

The Internet can save you lots of money, but only if you use it well.

More: The Living Below Your Means board.

The author has no beneficial interest in any of the companies mentioned, but just likes using them.