They Lie #2 "Interest Free for 6 Years"

I'm no Warren Buffet. (See the photo. That's Warren Buffett. From his own Wikipedia page.) I have a tax guy and a retirement guy because I don't know enough about taxes and retirement portfolios to do them myself. (Or do I? Hmmm...) But at my age (Don't ask; I'm not telling), I do know a thing or two about saving money and not overspending, which is the same thing. And I know enough to know that people, businesses and organizations will lie to make themselves a buck. As House used to say, "Everybody lies." And as I say...Well, see the previous blog about lies by clicking here.

So here's how a local (and national, I think) furniture store lied in a mailing recently:

It sent me a red, white and blue (July 4th week, right? Plus I'll bet it works subliminally) offer that said I could get any mattress or piece of furniture I wanted, and I wouldn't have to pay any interest for over 6 years. That 6 year thing was shown twice, in giant multi-colored print, twice on the same one page of this thing.

So there's a lot wrong here.

First, I noticed right away that there was not one single photo of a mattress of piece of furniture. (See the photo below? Furniture, right? Not one single photo of something like that in this ad. The photo is from jordans.com/living-room, by the way.) So what's being sold here? Furniture and mattresses? Nope. The furniture store is selling its payment options. And the option here is to get whatever you want, interest-free, for 6 years. So that struck me as odd, that a furniture store was focusing on its payment and interest options. Why would it do that? Well, I'll bet that they make more money on the interest payments than they do on their own furniture. That's why car companies sell cars the same way in TV ads. You see the car on the road, but the guys babble about the interest payments, or the no-interest, or the leasing options. They make more money off the money than they do off the car. Same here with furniture. Good for them, bad for you. Why? Because if someone's making money off your money, you're paying too much money. If you weren't, there wouldn't be any surplus money for them to make money off of. You'd pay just the price for the furniture, for example, so the store, the supplier and the employees get paid, but that's it. They have to move on. If someone's making money off your money, which is what interest is, then you're paying too much money. You don't want to do that.

Secondly, and maybe more important, YOU NEVER WANT TO PAY INTEREST ON ANYTHING, EVER, FOR ANY REASON. That's so important that I put it in impolite and angry caps. But the word "interest" is a swear word, right up there with mother----er and the C-word. In fact, it's even worse, because like an STD, once you've got it, you're never going to be able to make it go away. Right? Do you owe interest payments on a credit card? How about your student loans? Look at your mortgage. How much are you paying in interest? Interest in mortgages are unavoidable if you want a house (I've got 2 mortgages, so I know), but in everything else it is very easily avoidable. (If I can't afford to pay the monthly credit card bill, I don't buy it. And come hell or high water, I WILL pay off that credit card bill in full, and I will not make monthly payments on it, ever, for any reason. I don't have a cent of credit card debt, and I had no life for a few years after I got my degree so that I could pay off my student loans all at once, so I don't own a cent of student loans, either. But I truthfully was lifeless for a few years as I saved to pay off that bad boy.) If it's not an emergency--and I'm talking someone is dying here, or your house is about to cave in--and if you don't have the money, you don't buy it. Period. This furniture ad in the mail was banking on the fact (See what I did there?) that people are so used to interest payments, that the real kicker of the ad was the interest-free option and not the furniture. That's crazy. Because, once again, if you're paying interest, you're paying too much for something. There's no second course. If you're trying to lose weight, there's no dessert after dinner. And if you're trying to stay out of debt, there's no interest after the one initial payment.

You might think that you've got 6 years to pay that thing off, so you won't have to pay any interest at all. Fine--if that's true. But is it? What do you have to do to get the 6 years of no interest? What do you have to sign for? I'll bet you'll have to get that furniture company's credit card, and you'll have to get an account with them, or with whomever runs their financial backing. So someone's already making money off of you, and they're betting that you won't pay it off in 6 years. I repeat, someone's making money off of you, and someone's betting against you. That's inherently negative and should scare you away.

Well, let's read the fine print. After every "6 Years" there's an *. An asterisk means there's a catch, a stipulation, and it means someone's trying to screw you. If they weren't, the information would be in as giant, multi-colored print as the "6 Years." There's another * after "No minimum purchase" and a tiny crucifix (Why hasn't someone harped on that blasphemy, using a tiny crucifix symbol to screw people out of their own money?) after "No money down." They're also betting you won't read the fine print. No one ever reads the fine print. You should always read the fine print. So let's read the fine print. And I'm looking for the answer to the question: How much would the interest be?

Whoa! If you don't pay the amount in time, you'll be hit with 29.99% interest! Holy crap! That means you'll owe in interest $30 for every $100 you haven't paid. That's crazy! That's $300 for every $1000. That's insane. Is that worth the risk? Hell no! If you don't have any credit card debt, your own credit card has a lower APR than that. And, furthermore, you're already thinking badly because if you can't afford to pay it on your very next month's credit card bill, you shouldn't buy it at all. You can't afford to think that you have 6 years to pay that off. I can't. I can only afford to think that I've got 1 MONTH to pay it off, and if I can't do that, I don't buy it. Period. And, yes, my furniture's older, but it's comfortable enough. And, yes, I do deserve better--but that doesn't mean that I'm going to get it, or that I'm entitled to it. I have to earn it, and if I don't have the money for it in 30 days, I haven't earned it. Don't start down that interest-free road, because you don't know where that road ends. And "interest-free" doesn't mean "free." And if you're playing games with interest, you'll lose.

Photo: An asterisk in an early Greek papyrus. It's possible people were getting screwed with it then, about 2,000 years ago. From the Wikipedia page for the word "asterisk."

And it says here: "For $X a month you could redecorate every room in your entire home." No. No you can't. It takes a few grand to do that, and if you're like me, you won't be able to pay back a few grand in 6 years. If you can, then wait those 6 years and save and pay cash for everything so nobody makes a dime off your money and you're not in debt. Redecorating my home with brand new furniture would cost over $10,000. There's no way in hell I'd be able to pay that off in 10 years, never mind 6. And that'll be $3,000 extra in interest. So instead of $10,000, I'd owe $13,000.

And it doesn't say here that you can pay more than your equal monthly payment. Because you want to pay that off before the 6 years, right? To do that, you have to pay more than the equal monthly payment, every single month. If you're not allowed to do that--if you have to pay just the equal monthly payment so that you're stuck with this contract for exactly 6 years, then you're screwed. Because crap happens, and you're going to fall behind on a payment, maybe even the very last one, 6 years later, and your now in debt, or at the very least your credit takes a big hit.

No thanks. I'm throwing it away. Actually, I'm throwing it in the firepit, so I don't have to buy kindling. I'll save money off of the money this furniture company paid to mail this to me. So help me, I'll make money off of them.

And so that's how they lie. Misdirection, in this case. This furniture company is selling money with this ad, not furniture. Always ask yourself, "What would they gain doing that?" If someone were to call them up and ask them if they made more money off its payment plans or its furniture, I'll bet they'll say the payment plans. And that's how they lie. Not as bad as the flat-out lies meant to actually fool me like the last blog. This isn't for a power trip or for political gain. And everyone's got to make a buck, so this doesn't make me angry like the last one, but still...Ain't nothing for free in this world, right? Not even 6 years of interest-free payments. If it sounds too good to be true, it is. Especially if there's money involved. (Some things, and some people, are actually as good as they sound. But not if there's money involved.)

Next time on "They Lie": A mortgage company insisting they're holding a really low interest payment percentage for me that's actually higher than the one I already have.

Police Log--Paranoia and Brazen Honesty

There's still two weeks to enter my free contest and win stuff.  To do so, please go to this link, or just scroll down to the previous entry.  Thanks.

Until then, I thought I'd pass this along.  This is a snippet from my local paper's police log, where some very wacky people do some very wacky things.  And in Warwick, R.I., no less.  If this stuff is happening here, ca you imagine the shenangigans happening in L.A., NYC, Chicago, Boston, etc.?

From the Police Log (and from the Warwick Beacon's address):

PARANOIA

Officer [   ] reported he was doing a fixed traffic post around 4:40 p.m. on Feb. 4 when a man approached him and told him it felt like people were following him. [The officer] said he talked with him some more and learned the man thought every car that was driving past was following him and looking at him and told [the officer] that he should know because [the officer] was one of the people investigating him. He said the man claimed he spoke with numerous lawyers and they all confirmed that he was being investigated. [The officer] said he asked him who was investigating him and he said the police, although he did not know where he was or who he was talking to but he knew that Warwick Police were investigating him. He said the man was alternately excited and calm and inquisitive. He said he called for another car and patted the man down. [The officer] said he was nervous about the way the man’s hands would go into his pockets and then into a bowling bag. He said he had no weapons on him but did have what looked like $1,487 worth of gold Teddy Roosevelt $1 coins. [The officer] said he also found a prescription bottle in the bag and the man said, “That is Adderall.” He said the man claimed he had a prescription for the drug but the particular pills [the officer] was holding belonged to his sister. He said he and a sergeant discussed what to do with the man and they decided he needed professional psychiatric help. [The officer] said he confiscated the pills but did not arrest the man because Kent Hospital does not do psyche evaluations on people who have been arrested. He said they took him to Kent, where the staff began to explain how the evaluation would proceed and he became impatient and belligerent and turned and said, “[Expletive] it, you are just going to have to arrest me for the Adderall.” He was taken to headquarters, where he was charged with possession of a controlled substance and held for the bail commissioner. [The officer] said they learned that the man, who earlier said his name was Kenneth [   ], was in fact Giovanni [   ], 25, of [   ] Ave., Pittsburgh, Pa., and that he was staying at a local extended-stay motel. [The officer] said he asked the man why he had so many presidential coins, 54 identical rolls of Roosevelt $1 coins, and [the man] told him he was a collector but there as nothing else in the bag to indicate it was a collection. He said they did run a check on [the man] and discovered numerous arrests and convictions for robbery, burglary, fraud and receiving stolen goods in several states. [The officer] said a Google search turned up an account of $2.4 million worth of presidential coins were stolen from the U.S. Mint in Philadelphia in 2011. [The officer] said there was enough probable cause to believe the coins were stolen and that the Secret Service, who were investigating the heist in Philadelphia, be notified of the arrest.

(Me again.)  Now that's messed up!  How does a heavily-medicated, homeless paranoid schizophrenic man from Pittsburgh, Pennsylvania, get to Warwick, Rhode Island with 1,487 Teddy Roosevelt $1 coins in a bowling bag?  What?!?  Loved his response, too: He's a collector!  He probably sounded offended while he said it, too.

I couldn't make that up.  Or this:

Det. [   ] reported that a woman who was asked to come into headquarters about some fraudulent checks she’d cashed and quickly learned that it was about a purse that was stolen from a customer at Sullivan’s Publick House on Dec. 13 of last year. [The detective] reported that they had surveillance of the woman taking the purse and leaving by the back door but had more evidence that she used the credit cards in the purse at several places in Warwick and other places, but, under the circumstances, he welcomed her candor in regard to the fraudulent checks. She claimed she was cashing five checks worth $1,270 over the past week for a friend of hers and she only got $20 for one check but got a cup of coffee or a pack of cigarettes for the others. She said her friend was stealing the checks from an 80-year-old Warwick man who trusted her.

[A different detective] reported that he was there when [the first detective] was asking “the suspect in a stolen purse caper from Sullivan’s” and took the opportunity to ask her about charges made on her sister’s credit cards last November and about her sister’s laptop that went missing in December and charges on her debit card in March. He said she admitted using the debit card but denied stealing the computer. By the time the interview was over, [   ], 44, of [   ] Ave., Warwick, was charged with five counts of felony fraudulent checks, three counts of fraudulent computer access and larceny for the stolen purse that reportedly contained $140 in cash along with the credit cards.

(Me, again.)  It's hard to tell with writing from reports, but I do believe there was a little tongue-in-cheek with the underlined sentence above, as it seems a bit too dry and straightforward to me.  "He welcomed her candor," indeed.  Sounds like the first detective waved the second one over not because he feared for his safety, but because, "Hey, Harry, come here, you gotta hear this."

And this is all in one day, in one police blotter.

So let me know what you think, and maybe I'll offer up more of this stuff.