How The Fine Print Can Sabotage Your Finances

How The Fine Print Can Sabotage Your Finances

By

Marsha Walker Eastwood, Bs, MSHSV

In this very chaotic and oftentimes confusing world, finding a quick fix for an annoying problem, but sometimes the “fix” not only does not work, it has a negative impact on our finances.  Case in point – recently while trying to thread the needle on my sewing machine I became very frustrated at the number of fruitless tries. My eyeglasses seemed to fail me so after trying several different lighting ideas, I decided perhaps a magnifying glass would be just the thing.  After searching for nearly an hour imagine my delight in finding one with a light and batteries already installed.  That delight quickly faded when I tried it and the magnification was too great and I still could not find the irritating hole in the needle, and I was stuck with what was sure to be another useless tool.  After I calmed down and collected myself, I realized that had I read the fine print I would have noticed that the magnification level was 3x which was far too powerful for my immediate need.

After I abandoned by project, I sat there holding that magnifying glass in my hand and I thought about how much money the average consumer wastes by not reading the fine print.  From a simple bottle of over the counter preparations to prescription medication labels, cosmetics, household chemicals, credit card disclosures, contracts, and yes even the front card of a magnifying glass,  we are so consumed with the quick fix and/or that “get ‘er done” mindset that the information contained in those size 8 font words just seem too troublesome to bother reading.

There are four types of personal financial drains that are secondary to fine print overlook. One is money spent on items that are used a few times and then left to collect dust on a shelf such as specialty personal care products. The second one is the enormous array of health supplements.  The third is As Seen On TV merchandise.  The fourth is contracts and warranties. The first two categories are products that are heavily advertised by the bath and body products industry and the cosmetics industry.  

According to Verified Market Research, The US Skincare Market was valued at USD 26.92 Billion in 2018 and is projected to reach USD 37.13 Billion by 2026, growing at a CAGR of 4.08% from 2019 to 2026.  This market includes bath, shower, and after-shower products as well as anti-aging lotions, creams, and serums that all tout their ability to soften and relax skin and take care of those pesky lines and wrinkles found in aging skin.  Some of them promise to reduce the bags and dark circles under the eyes and provide as fresh and healthy glow to the skin. Some of them even created sticker shock.  But what they all must do is provide labeling, aka the fine print that includes the ingredients and informs you that all skin types are different, so the results vary by user.  They also tell you what they will and will not do. Depending on the product the, the fine print may include warnings not to use it under certain circumstances. Sometimes they include a suggestion to do a skin patch test, but who has time to read all of that.  Afterall it worked for your Aunt Shirley, and your best friend forever Janet, so why bother with all that little print.  Just slather or dab it on.  In this day of must have immediate results, if those lines or wrinkles are just are visible, and those eye bags that promised 8 hours of invisibility or near invisibility are highly visible like a 5 o’clock shadow at 3 pm., the products are moved to the dust collecting shelf of a medicine cabinet or a drawer to join other products of similar ilk. 

Oftentimes the problem is not the product but the user.  Looking in the mirror at those fine lines, wrinkles, dark circles, and bags can create a call to action.  New routines start off great, even if they are time-consuming, and there must be more than a slow drip infusion of motivation to keep things going.  The routine may go well the first week or so, but then those few extra steps getting ready for work or before bedtime become difficult to maintain.  The number of products you have on those shelves represent a financial gain for the skincare products industry and  financial hit to your finances. If you purchased them with a credit card it is a double loss because more than likely you paid interest on your collection of dust catchers. 

In a society that is more than moderately obsessed with health and wellness, a 2019 report by the FDA, in the 25 years since Congress passed the law that gave the agency some regulatory authority in this area, the dietary supplements business has grown from a $4 billion industry comprising about 4,000 products to one worth more than $40 billion, with 80,000 or more products available to consumers. These supplements include botanicals, vitamins, minerals, proteins, amino acids, fish oils in the form of tablets, capsules, powder, liquids, soft gels, gel caps, and gummies.  They also include products that promote brain health, joint health, and heart health.  More often than not, these items are purchased for conditions that require a medical diagnosis for treatment and based on clinical data serve no useful purpose other than to empty wallets and increase credit card debt.  The fine print, which often goes unread provides information about contraindications with other medications and warnings about existing medical conditions.  Oftentimes the medical community is odds when it comes to the benefit of certain supplements.  Many ophthalmologists recommend fish oil for their diabetic patients, only to be pooh pooed by their internists.  There are households with medicine cabinets filled with unused supplements, collecting dust.

When it comes to warranties and personal documents and contracts, nothing is  more important than the  As Seen On TV category is one that can tempt even the most frugal among us.  The products seem to hawk sales of just about everything you could ever want, need, and provides some pricey food for the ego as well.  One item can take the place of all of those counter clutter items people paid tidy sums for at the low, low price of $59.95 per month for three months, including bonuses items and for a limited time only you can get a second item for just additional shipping and handling.  If the order is placed online the fine print details your consumer rights.  An order that started out at $60.00 a month has now ballooned to $100.00 for the first payment using a credit card. The buyer will pay interest on the amount before they even receive the item.  And what about all of those barely used counter and cabinet clutter items?  One of three things – they will continue to collect dust, be sold on an online marketplace for pennies on the dollar or given away. 

When it comes to financial contracts, personal contracts, and warranties, nothing is more important than the fine print.  That bold headline of a credit card offer lets the consumer know they have been preapproved for the card, the amount they are approved for and the percentage of interest on an outstanding balance.  Other relevant information such as penalties for missed payments and the circumstances for cancellation of the card, or reduced credit are written in a significantly smaller font.  If you borrow money online the entire contract is written in fine print and that is by design. The lenders know that most people are so desperate for the money they skip through most of the fine print and scroll down to check the box marked “I accept”.  Hidden in that small print are terms of the loan, refinance options, potential changes in interest rates, penalties for missed payments and options for extensions.  The refinance information is extremely important as it gives a clear picture of how long it will take to repay the loan and how much the consumer will end up paying for money borrowed.

Almost all business contracts are in small print and the fact that some contain two or more pages makes for tedious but necessary reading.  This includes car repair estimates, leases, rentals, home repairs, and others.  The fine print details your rights which include arbitration procedures and timelines to file a complaint.  Hospital and nursing home consent for treatment, legal representation contracts, and even the fine print on a driving or parking ticket can save you money.  It details your payment options and timelines.  A $20.00 ticket when paid within a certain amount of time will cost you $20.00.  If you do not pay it within the specified timeframe you may be required to appear in court and suddenly that $20 ticket now includes a penalty and court costs.

          Product warranties can be money generators for people who do not read the fine print.  If you buy a smart TV, warranty information is usually hidden in the fine print near the bottom of the box.  It details what is covered and what is not. The same information is included in a package insert inside the box.  Bearing this in mind when the cashier asks if you want to purchase a warranty, there are two questions you need to ask.  The first one is does the warranty cover anything above and beyond the manufacturer’s warranty and how long do you have to decide? Remember if you decide to buy the warranty, it will increase the cost of the unit and if you use a credit card you that little warranty can become more expensive than you imagined.

          Fine print has always been the bane of consumers. It can be tedious and uncomfortable, what with all the squinting required to read it.  However, if you have a magnifying glass lying around somewhere maybe it is worth the effort to take it along with you on shopping trips or when conducting business.  It can help prevent you from sabotaging your finances.

© Marsha Walker Eastwood

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