Chapter 5 Buying the Necessities Section 5-1: Shopping for Food Comparison Shopping Involves making comparisons to help decide what to shop for and where to shop Only comparison shop as necessary by weighing time and transportation costs. Advertisements and coupons can help save time and money The Trade-Offs in Food Stores Club warehouse stores generally offer the lowest prices, but their items are only sold in large quantities Convenience stores carry few items, have highest prices, but are open more hours. Brand names are well-known nationally or regionally. Some supermarkets or wholesale stores have their own brand names known as private labels or storebrands. Generic products have no brand names. Section 5-2: Clothing Choices Comparing Clothing Value Buying current styles, which tend to change each year, can be expensive because new clothes must be bought annually. Buying classic styles, which are more basic and do not change as much, will help your clothes last longer, saving money. Durability I show well something lasts over time. Service flow is the amount of time you get to use the product and the value you place on that use. Factor in the cost of care involved in clothing that must be hand washer or dry cleaned versus machine washable. Much for Less Clothing costs have decreased significantly over time. Clothing sales generally happen at the end of the season. Bargain fanatics buy items just because they are on sale. If you buy an unnecessary item because it’s on sale, you may not be saving money at all. Section 5-3: To Rent or to Buy How Much Should You Spend? Avoid spending more than you can afford. You will need the cash down payment and closing costs. Be aware of points or fees paid to the lender. Financing the Purchase of a House Many different types of mortgages and financing packages are available. Mortgages involve down payments and interest. Mortgages are paid in monthly installments. Property tax, homeowners insurance, and mortgage insurance are often included. Renters Rights and Responsibilities Renters usually sign a lease. Be aware of the clauses in your lease; read it carefully. Tenants have a right to use the property for the purpose stated in the lease, and a right to privacy. Tenants must pay rent on time, take care of property, and notify landlord if major repair is needed. Renters Rights and Responsibilities cont. Some tenants must place a refundable security deposit in case of damaged property or unpaid rent. Tenants must give written notice if leaving prior to lease’s end, which can result in fees and fines for breaking the lease. Landlords must provide minimum services and obey building and safety laws. Rent-control laws limit the amount a landlord can charge in rent. Section 5-4: Buying and Operating a Vehicle Buying and Operating a Vehicle Registration fees are state fees paid each year. Normal maintenance and repairs Cost of buying an extended warranty that covers problems beyond the time frame in the warranty offered by manufacturer or dealer. Buying and Operating a Vehicle cont. Depreciation or a decrease in value of car as it ages. Most states require liability insurance that covers both bodily injury and property damage. Cost of insurance varies based on age, sex, and driving history.