MSE News: Households ripped off by £430 each year, report says

Loughton_Monkey

The expression "rip-off" is overused.

If I buy a book from Amazon (or more likely a lesser known site) and it doesn't arrive... they take my money... and then do a moonlight flit then I have truly been 'ripped off'.

If I go to W H Smith and buy a book at £10.99, and come home to find Amazon are selling it at £7.99, I have not been ripped off at all.

If I buy double glazing with promises of a draught-free house, and much lower energy bills, and I get a bodged-up job and the firm will not do anything, then I have been ripped off.

If I cannot control my expenditure and pay bills, and I am forced to buy electricity pre-paid (which costs more because of extra equipment and administration) then I have not been ripped off.

People who are uneducated, cannot understand numbers, do not understand budgeting, cannot allocate their money wisely, tend to end up on pre-paid meters, going to pawnbrokers to borrow money, or - even worse - payday loans at 4,000% interest. This is not a rip-off. It's market forces firmly at play.

There are many people who put these facts together and say that the poor get "ripped off". That may be true. But we should understand that this is not directly because they are poor. It is merely a combination of two factors:

1. People who are stupid, uneducated, unreliable, or demonstrate reckless behaviour tend not to get jobs that pay plenty of money. They are much more likely to get low paid jobs or be unemployed. Hence they are 'poor'.

2. People who are stupid, uneducated, unreliable, or demonstrate reckless behaviour tend not to be astute enough to shop around, buy wisely, avoid extortionate costs, or be able to understand and manage a 'budget'.

This is where governments get things wildly wrong. It is stupidity, poor education, and reckless behaviour that causes both traits. Governments have themselves been stupid enough to throw money at people to 'cure' the problem. It hasn't cured it. It doesn't cure it. And it never will cure it.

Only better education, coupled with complete intolerance, within society, of reckless behaviour will ultimately cure the problem.

SteveV2

They secretly own apple?

Makes sense now

Dave_save

Being ripped off is an oft used phrase but means different things to different people, depending on circumstances.

If I pay my council tax every year and the services I pay for are either poorly delivered, or not delivered, then I have well and truly been ripped off.

If I pay an annual charge of £120 for a current account and receive services I could have obtained for £40, I haven't been ripped off, it means I've been careless and it's my fault for not checking first.

I've always believed that the biggest rip offs are the services or goods we are promised which turn out to be poor or non existent. I don't know if it's a world wide issue, but for me the biggest rip offs in this country are the so called 'customer services' eg of banks and utility companies which promise so much with no intention of delivering. These services are paid for within the price and invariably we get short changed.

Credit-Crunched

Pincher wrote: »

It's the poor that pay more.

The If you only have 10% deposit you pay more than somebody with 40% deposit for mortgage. You are deemed a higher risk by the lender, as such you have to pay more for them to lend you the money

Pre-payment meter costs more.

People who buy old bangers end up spending time and money to fix them up. People who buy a new car spend £9000 changing a clutch, someone who buys a 1990 VW golf pays £200

People who live on council estates get more break-ins to their house and car. Consequently they also pay more for insurance. again higher risk, so yes they should pay more as it is a higher probability that they will claim

They can't get personal loans so they go to loan sharks. they can not get personal loans as they have historically resined on debt and failed to pay, as such no further credit is available

I worked out why a friend never buys in bulk, which I do a lot: he hasn't got the money for it to sit on shelves. The consequence is he gets a lot less in quantity and quality for the same money.

I think that this article is yet again more MSE tosh

chewmylegoff

Daaaaaaryl. Daaaaaaryl. Daaaaaryl.

lippy1923

People who get ripped off are lazy and/or stupid. I certainly do not believe I get ripped off. If I pay for goods or a service that is of poor quality I complain. This either results in a refund or compensation.

Banks certainly do not rip me off. In fact my bank pays me and OH £5 each a month just for getting paid. They gave us cashback for just applying for the account as well. Im getting 4.25% on my instant cash ISA and paying 0% on my credit card which I use for stoozing. This gains me something like £50-£60 a year.

I always shop around for insurance/utilities, playing each competitor off and then negotiating a final premium I am happy with.

It just depends on the person and if they can be bothered to shop around. People only rip you off if you let them.

pqrdef

Loughton_Monkey wrote: »

This is not a rip-off. It's market forces firmly at play.

Market forces and rip-offs aren't mutually exclusive.

Markets aren't sacrosanct. They can be fair if the playing field is level, but it usually isn't. In consumer goods and services, the seller is usually a specialist. He knows the field inside out, and the law, and the loopholes, and the customer psychology.

But Joe Public needs to buy a lot of things. He can't be an expert on all of them, and can't be expected to be. In fact, he's a sitting duck.


Incidentally, people who are stupid can't help it. It's not an excuse to exploit them.

Loughton_Monkey

pqrdef wrote: »

......Incidentally, people who are stupid can't help it. It's not an excuse to exploit them.

Well I'm not totally sure. There is an extremely small number of people born with brain damage....

But I certainly remember lots of people at my schools, who preferred 'mucking around' to listening to the teacher. Didn't care about doing homework....

You may call this "can't help it", but I would call it "could have helped it". Just because some people wasted their big chance in life simply by their own behaviour, and hence can be labelled 'stupid', I don't think there should be special treatment for them.

If they don't have the acumen to shop around, compare prices, use a computer (to get best deals), manage their finances (to avoid overdrafts), spend only what they earn (to avoid high interest loans)..... then I simply cannot see organisations saying "just do this IQ test. If you're intelligent, then I'll charge you the full price. If you're unintelligent I will tell you where you can get it cheaper, or I'll charge you less myself, or I'll help you budget properly....."

Rip-offs (the criminal ones) are wrong in all circumstances. Higher prices/poorer deals [that you may call exploitation] are not aimed at stupid people. They are aimed at people who need money quickly, or only bother to go to their nearest place... It just so happens, that there is a very strong correlation of these symptoms with stupidity.

Medstudent

It really depends what they mean by rip off, if they mean could have got a better deal by looking around it isn't really a rip off. Although it isn't playing fair when companies deliberately muddy the water on options available and have T&Cs that are unnecessarily long and in size 1 font.

Loughton_Monkey

Medstudent wrote: »

..... Although it isn't playing fair when companies deliberately muddy the water on options available and have T&Cs that are unnecessarily long and in size 1 font.

I tend to agree with that.

Easy solution. Let's invent the concept of "Regulators". If we had those, they could stop this at a stroke! Simple.

Let's all get together and create an e-Petition to the Government suggesting formation of Regulators for, say, Financial Services, Energy suppliers, Water suppliers, Railways, The Press.......