Chapter 5

1. Chapter 5 Buying the Necessities

2. 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

3. 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 store-brands. • Generic products have no brand names.

4. 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.

5. 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.

6. 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.

7. 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.

8. 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.

9. 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.

10. 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.

11. 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.