Monday, November 9, 2009

That's where they getcha

In a capitalist society, every transaction is about the markup. The providers of goods and services want to charge as much above their cost as they can to make a profit. The consumers want to bargain that down as much as they can.

We accept a certain amount of markup as the cost of doing business, of living our lives. But we may feel taken advantage of when there are extenuating circumstances. When our emotions get in the way, we are vulnerable to not making rational decisions, and a cool, calm businessman is more than happy to step in.

Here are two times when you may want to step back and not let your emotions get the best of you. Or you may feel that the emotional value in the situations is too much, and you don't mind paying the premium.


Funerals are bad business all around, and they are also a fact of life. Grieving, upset families are forced to make decisions they don't want to be making while they try to deal with the loss. It's the ultimate time when emotions can cloud rational judgment.

First, the family probably just plain isn't in the mood to bargain or dicker. Second, there's an intense need to feel like they are doing *something* to make this better, and paying a lot for the funeral can feel like it is that something.

Funeral homes know that, and while they aren't being evil, they are being a business when they charge an arm and a leg. The ordinary markup on a casket is anywhere from 300 to 500 percent of cost. That's supply and demand, but should we really be willing to demand at that cost?

The solution? Plan ahead with your loved ones. Know their wishes and make sure they know yours, so that you can each have peace of mind when the time comes that you are doing right by your loved one. Even better, pay for it in advance. That's usually better than waiting until the last minute.

If you feel that you want an expensive funeral, that's fine. But if you don't, make sure your family knows now.


I have personal experience with this right now, having a 9.5 week old son sitting next to me as I type this. I simply cannot believe what people will pay for infant products.

Actually, I can believe it. The day after the ultrasound told us we were having a boy, and thus the little baby in there had a name to go with the idea, I was walking through the baby section at Wal-Mart. I was practically overwhelmed with the desire to have everything I saw. For him! How could I let a little money stand in the way of my son having anything? Every toy might be the difference between a properly stimulated brain and a lifetime of dullery! Every safety device might save his life! Cost meant nothing!

I snapped out of it.

Babies need security and attention from human beings more than anything else, and those are free. Not to mention that they grow out of needing most basic equipment so quickly that the secondary market is absolutely flooded.

Don't let cold, calculating businesses prey on your emotions. When you feel the least urge to consider the cost, that's probably when you should be doing it the most.

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