Everything we do in our lives, in our daily routines, and in spurt of the moment activities has a cost to it. Even making money to be able to buy the things we want and need has a cost. We may commute to work each day and we have the cost of gas or the cost of a train ticket. Perhaps we work from home and have the cost of the electricity and Internet connection. In purchasing food and clothing for ourselves and our families, we have the cost of the actual items we purchase and the cost for the transportation to get to the store. In some way, shape or form, everything has a cost at one point in time.
In the world we live in today, items and services seem to getting more expensive. Cost for an item today is multiplied from what it was just not too long ago. As a society that seems to need more and want to pay less, we are continually striving to find the best deals and pay the lowest price. I am right there in it too. When I find a good deal, I like to be able to take advantage of it. The problem, however, then becomes how do we know if we are getting a good deal? What is the price of something we purchase truly cost? We love to look at the price tag and see things like “Sale” or “Clearance”, but how do we know we are getting the best thing? Simple, we forget about cost and focus our attention to value.
In my experience working in the customer service/tech support industry, I have found that many people don’t want to find the best deal at first, they want to rather get the lowest cost. My logical brain is baffled by this, but I see it all the time. We get so fixated on cost, that we lose sight of value. For example, in my daily work customers contact me and say they want to lower their monthly service bill. I certainly understand, times get tough and sometimes we need to cut back. I do this as well.
In these situations, I provide my customers with a lower cost option and let them know what this option includes and the benefits it provides. Almost every time, when I provide this info, the customers becomes upset and threatens to go to a competitor since it provides less than what they currently pay for. I find the human psychology of this fascinating! Although we say we want to lower our cost for a product of service, what we truly are saying is that we want to pay less for what we are already receiving. Since this is unfortunately not the way that companies operate and unfortunately not the way the world works, we have to come to terms that there is a non-monetary cost to lower our financial costs, we need to lessen the value.
Do you want to save $20 on your cable bill? Lower the cable package. Do you want to save $20 on your cell phone bill? Lower the data plan. Do you want to save $30 on your monthly groceries? Buy less food, shop sales or use coupons. Do you want to save money on gas? Drive less.
I understand that some of these things may not be possible, and that fine. For the things that you can’t lower, you need to come to terms that this is the cost or find an alternative. Do you feel like you are not getting the best value from a service or product? Before going crazy trying to find a way to lower cost, ask yourself why. Or perhaps think about how much you do truly use the product or service and the true value it has on your life.
This is a simple exercise I have used with people before when talking about cost. Is $5 expensive? Before reading on, just let this soak in for a moment to see what thoughts conjure up. In my experience, there has been one of three different responses to this question. 1) No, it’s just $5. 2) Yes, that’s $5 man! 3) What am I buying? These people who fall into the third group are the ones that look at value.
Here is another way to test yourself as well. When getting a bill for a monthly service that you feel is too high, before calling the company to ask for discounts or demand credits, look and see what you are actually being charged for. Is it for something that you actual use? Is it something you could go without? Would the cost of giving this up be greater than the monetary cost you pay for it? Are you finding value?
What I have found myself doing recently is prioritizing things more and more. This also holds true to costs. When looking at a cost of something and determining its value, where does this fall as a priority? Sometimes this can help to better define the value, allowing you to think about the cost of not having it. A great example of this that I have discovered myself a while back and more recently posted about was life insurance (See “What I Never Realized About Life Insurance”). Having life insurance did certainly have a cost, but it provides great value to my family and was made a high priority to me because of that.
Do you have a long commute to work? Perhaps this is something else that is prioritized and not even thought about. This includes things such as having a more expensive, but more reliable car. Maybe this means buying the more expensive gas for your car. Sure you can certainly buy an inexpensive $300-$500 car to get to work on this long commute, but how long is it going to last? How much extra money are you going to put into it to maintain it? Sure a more reliable car will be more expensive, but you will get more value. The car will probably last longer and also require less in maintenance. If you go with the first option (the $500 car, which is completely fine of course), over time this may end up costing more. This is the cost of having the lower initial cost. So in the end, is the priority to have the lowest short term cost or is the priority to have the greatest value and perhaps have a higher upfront cost that will end up paying for itself?
When it really comes down to it, as consumers we need to pay a lot more attention to value. Although the cost of something is important, the value is what really tells us if we are getting a good deal. Before complaining about the cost of things, sometimes we need to think about what we are getting in return. If I am honest with myself, I admit that there are some things that I would actually pay more for and still find great value in. What kinds of products and services to you value the most? Have you ever been baffled by a larger bill in the mail and then changed your outlook once you thought about the value? I would love to hear from you. Please comment below.
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