Have you ever paid for a service and thought, “Something’s fishy about this.” Whether it’s an upgrade on a car rental, a gym membership that requires in-person cancellation, or pet insurance, plenty of deals we sign up for don’t offer any real benefits. For example, about 67% of gym memberships go unused, and businesses rely on people overestimating the times they’ll attend and take advantage of it.
There are more similar shady business practices, and in one recent online thread, people from all kinds of industries shared their insider secrets. When one netizen asked, “People who work in industries that are secret scams, what are some things the general public should know to save money?”, many sectors were exposed. Read on to find out why unlimited data plans, electronic warranties, and eyewear might not be worth the money you’re paying for them.
#1
I used to work for a company called Furniture Care Protection. It’s absolutely bogus. You buy all this expensive furniture and at the end they offer you a “protection plan”. They tell you it covers all rips, tears, stains, dents, dings, discoloration, pet accidents, etc., so you buy it thinking it’s a win. Fast forward a year, your child spills a drink on it. You call it in, they want photo “proof”. This is the part where they completely dissect your photo. They find a small tear that you didn’t even realize was there. You’re now denied for multiple issues. You’re furious because you only want your spill cleaned because now the process has taken 2 months and smells. Now they really deny you because in the small print it says they don’t cover multiple accidents and/or smells. So now you’re stuck with a smelly piece of furniture. They’ve denied elderly customers whose adjustable bed or recliner were broken because of tears that weren’t reported but were seen in the photos. I got into a big argument with my manager because he was wanting me to deny a soldier who was stationed somewhere and their furniture was damaged in the unavoidable move because “we don’t cover damage from moves”. It was wild and extremely stressful because I always agreed with the customers. Do not buy a protection plan from Furniture Care Protection. We were always being threatened and I was terrified someone would actually go through with their threats.
Image source: AmarilloH****r__93, Esra Korkmaz/Unsplash (not the actual photo)
#2
B2B software sales. the demo environment is almost always completely different from the real product. things that look smooth in a sales call take weeks to set up in practice, require IT involvement nobody told you about, and have limitations the sales rep conveniently didn’t mention. the “30 day free trial” is specifically designed to end before you’ve seen what the actual implementation looks like. always ask for a reference from a company your size before you sign anything.
Image source: Equivalent_Cap8649, Getty Images/Unsplash (not the actual photo)
#3
Storage. Specifically the public one. Total scams. They will offer you low rates to move in and an extra discount to use auto pay. Then once all your stuff is on site they consistently raise your monthly rate. Sometimes 3x in 8 months. It never stops.
Always read their pricing policies and go with a small local storage if possible they are more likely to keep your rate as is for longer periods of time.
Image source: SteveLangfordsC**k, Getty Images/Unsplash (not the actual photo)
#4
The senior consultants you hired probably has no prior knowledge of what they are advising you on. You’re paying them to learn.
They’re also probably not senior.
Image source: KGB_cutony, Vitaly Gariev/Unsplash (not the actual photo)
#5
Do NOT get any retailer credit card if you do not intend to pay your statement in full. If you do decide against your better judgement to get one. Be prepared for at least a 30% interest rate if not higher. If you cannot afford the merchandise at cost, you don’t need it.
Image source: skrinklada85, Getty Images/Unsplash (not the actual photo)
#6
Do not take out loans from non-banks unless you really truly need it. Aside from credit unions.
Image source: Neat_Painting_9424, Getty Images/Unsplash (not the actual photo)
#7
Mattresses. The industry has spent decades convincing people that every mattress needs to be replaced every 8 years and that you need the $3,000 “premium” model. Most people would be perfectly happy with something far cheaper, and a lot of what you’re paying for is marketing, brand names, and fake sales that somehow never end.
Image source: One_Situation_5291, Getty Images/Unsplash (not the actual photo)
#8
I used to sell extended warranties, and it’s a total scam. We were forced to push them because the profit margin is almost 100%. Gadgets rarely break in that window, and if they do, your credit card benefits probably cover it anyway. The store just pockets your cash. Never buy them.
Image source: AppERact1ve8, Lala Azizli/Unsplash (not the actual photo)
#9
Weddings. Say the word “wedding” out loud to a vendor and the exact same cake, flowers, and van quietly triple in price.
Image source: InternationalMap9287, Curated Lifestyle/Unsplash (not the actual photo)
#10
I used to work at a major american flooring company with an incredible catchy jingle. Never ever ever ever ever accept their first quote. Quotes are exorbitant and go to the sales reps bonus. The fair market price is normally 1/2 the original quote.
It’s useful to get a quote from them, haggle it down, then find another flooring contractor and see if they can beat the quote on labor (for the same material).
Image source: howmuchforthissquirr, Getty Images/Unsplash (not the actual photo)
#11
Gym memberships. If cancellation requires a phone call or in-person visit, that’s the whole business model.
Image source: treumslut10, Getty Images/Unsplash (not the actual photo)
#12
If your plumber, HVAC technician or electrician advertises on TV, they are charging you way too much.
See if you can research if they are owned by private equity, it’s likely the same PE company owns several of the larger brands in your area. They know exactly what your market can bear and won’t charge you not a penny less.
Image source: Ok-Plankton6192, Kateryna Hliznitsova/Unsplash (not the actual photo)
#13
If u pay a company to run digital ads with media that you provide, you are absolutely flushing your money down the drain.
Image source: viln, Will Francis/Unsplash (not the actual photo)
#14
Car dealerships. They make you focus on the monthly payment instead of the total price. Always negotiate the full price first, never the monthly payment.
Image source: Irinav-84, Getty Images/Unsplash (not the actual photo)
#15
Don’t ever believe the top 10 lists in travel magazines. 9/10 are just paid ads.
Image source: Dino_Spaceman, Curated Lifestyle/Unsplash (not the actual photo)
#16
Do not fall for these “rent a solar power system for your house” scams. They charge you for free software updates from the manufscturer and everything costs like 10 times what the normal price is. Over time you pay a fortune for some basic solar power stuff, you could have bought for a fraction of the cost.
It the ones that pop up first on google when you search for solar power.
Image source: BlacksmithWeirdo, Curated Lifestyle/Unsplash (not the actual photo)
#17
Don’t buy prime meats delivered to your home. The quality is great but you HAVE to buy in bulk and guess what? We also sell freezers.
Image source: Figgywithit, Curated Lifestyle/Unsplash (not the actual photo)
#18
Pest control is a big scam. You probably don’t need it. We get people on expensive monthly subscriptions where the tech who has no training doesn’t do anything.
Image source: LordBardly, Getty Images/Unsplash (not the actual photo)
#19
Mosquito and tick spraying your yard does not work. Everyone who has it and tells you it works is absolutely fooled. I worked for a large franchise spraying 150 properties a week for seven years. I didn’t use any of the pesticides or repellent I was supposed to. Just water. I was the highest rated tech six years in a row. It’s one of the worst things you can do for the environment, and it’s about 100 times less effective than spraying yourself with deet.
Image source: Open-Season-2084, Getty Images/Unsplash (not the actual photo)
#20
I’ve been in catering on and off since 2009 for a NBA team, a pretty sizeable and prestigious university, a few hotels, and my personal favorite: casinos.
A large portion of the food is processed and comes from food distributors like Sysco. Which I’m not dogging it, they have good food. But before I worked in hospitality I thought that they made their own food from scratch but they absolutely weren’t. Same thing with alcohol. People would order wine thinking it was “fancy” but that $7 glass cost us $8-$9 for the bottle. Most of our drinks (despite being 50′ from the casino floor bars) was $2-$3 higher.
Weddings are much the same. A large amount of the centerpieces and cutesy decorations come from websites like oriental trading. The tablecloths and other linens are pretty cheap overall, but it became evident that it was more cost-effective to just buy our own linens.
As for the casino floor: (this is for Oklahoma tribal casinos I don’t know how other casinos are) slot machines are literally designed to create dependence. Say you play a 3 coin 25 cent Lucky Duck machine (one line straight across, bet 1 coin = 25 cents, bet 2 coin = 50 cents, and bet 3 coins/max bet = 75 cents). So you hit max bet (75 cents), and it makes noise and flashes like you won something, but when you look at your credits- you have 25 cents less. Those are called “false positives” they trick your brain into releasing dopamine and endorphins so you keep playing because your brain can’t tell the difference because of the lights and sirens and release of the reward center in your brain.
Those little rewards cards they give you for free play? They create an algorithm that tracks how much you spend , what types of games you like to play, if you order food or drinks, how long you stay at certain machines, etc. So they’ll be like, “yourusernameistaken is playing! He likes to play lucky duck-3 coin machines, he brings about $200, and leaves after an hour and a half or when he spends $150. We need to keep him playing more and longer.” And then once you get down to like $75 it’ll give you a big win that almost brings you back to what you started with, but not quite. All to entice you to gamble more and more.
Here in Oklahoma at the tribal casinos, they usually start off as small buildings (most originally started aa bingo halls and grew from there) and grow into these monstrosities aka “resorts.” You have the best odds of winning in the card games here-statistically. What you wanna do if you’re here to win is to play blackjack or poker at those small casinos (ones that don’t have a hotel attached to them). The small casinos like that use 6-9 decks I believe, where as the large Vegas-style resort casinos use 13+ decks. Which is still possible to count cards, although it’s significantly more difficult to do with that many cards in play.
Also those progressive jackpots? The ones that look like an odometer in a vehicle just climbing and climbing? Apparently every casino that has that game in their casino pays into a pot. Whichever casino hosts the jackpot has to pay it out once the machine and jackpot is verified (which takes hours/a day or so and sometimes they find that the machine had an error so they dont have to pay-but it never ever has an error in your favor), and then the rest of the casinos reimburse that casino for the win.
According to the National Indian Gaming Commission, the tribes must pay out X portion of the amount of money they take in. However, for most of the tribes that have many casinos and/or resorts, it’s cheaper to pay the fine than it is to follow the rules.
The machines that typically payout the most IME are the ones that are making the most noise, and also the ones by the high limit room. They seem to always be active and ringing.
The same people that design casinos are the same people that design Walmarts. They create convoluted maps where rows end into another row of machines like a maze. This is to encourage you to get lost, lose track of time, and entice you to gamble. They also don’t have clocks or windows for that very reason.
Image source: yourusernameistaken, Pablo Merchán Montes/Unsplash (not the actual photo)
#21
Wireless (cell phone) service.
Unless you have a family (4+ people) that all need phones, going with the major wireless companies, at least in the US, means you’re overpaying for your phone service.
You should really look into the MVNO (Mobile Virtual Network Operator) or “prepaid” services. Many of them offer the same level of service, the same core features, running off the same networks, and charging you less than half of what you’d pay going to the Big Three (Verizon, AT&T, T-Mobile).
There are caveats. MVNOs typically don’t offer:
– Included streaming services and perks
– “Brick and Mortar” stores to go to for in-person service
– “On us” phone deals involving the latest and greatest flagship smartphones.
But, when you think about it, these perks aren’t so much perks, but just methods of keeping you stuck on that postpaid service. Brick and Mortar stores are less and less focused on offering customer service, and more and more on selling you more lines and service (T-Mobile these days literally forces their store staff to guide you to use the app on your phone to take care of anything service or phone-related). Those “phones on us” deals involve phones that are locked to the service, meaning you’re stuck and can’t switch unless you pay off that “free” device… and the inflated cost of the wireless service is actually subsidizing that “free” phone.
Often times, buying your phone unlocked outright (or financing thought the manufacturer, if you have to finance) and going with a prepaid service will save you more money that that “free” phone on a major carrier.
There’s a stigma associated to prepaid service (some people think it’s only for folks with bad credit, and/or that the service is inferior), and the major carriers know this. That’s why they charge what they do, and imply in their marketing that you’re paying more for something better. yet, they also OWN some of those MVNOs, because they also get that there are come people who are wise to all of this.
Some example MVNOs to look at:
– Cricket Wireless (owned by AT&T)
– Visible (owned by Verizon… which also owns Total Wireless, Tracfone, StraightTalk, etc.)
– Mint Mobile (owned by T-Mobile)
Also look into some independents, that offer cell service on all three carriers:
– US Mobile
– RedPocket.
Image source: tubezninja, Getty Images/Unsplash (not the actual photo)
#22
Measure your laundry soap. Some people just fill the cap and drop it in.
Seen first hand at a previous job: A major brand of US laundry soap re-engineered the complex mold for their plastic measuring cap to hold more soap without looking different on the outside. By making the cap hold more laundry soap the fill-drop customers would use more and buy more often. Changing the cap cost them multiple millions of dollars. They expected to make more than that.
Image source: decian_falx, Kateryna Hliznitsova/Unsplash (not the actual photo)
#23
Debt consolidation firms. You can do everything they do on your own which is essentially reaching out to your creditors (credit cards, mortgage, personal loan, etc) and ask for lower interest rates or a new payment plan. Then do the debt snowball payoff. Pay off smallest loan first roll that payment you were making into the next lowest amount owed. Once the second one is paid off take that payment and roll into the next and so on. There’s other ways to do it as well, but that was how the company I worked for structured payoff. Most people don’t know if they keep pushing when being told no that something actually can be worked out. Mostly.
Image source: BumpinBakes, Getty Images/Unsplash (not the actual photo)
#24
Eyewear. Most of the brands you’ve heard of, Ray-Ban, Oakley, designer frames, the big optical chains, even the vision insurance, are one company (EssilorLuxottica). That’s why a frame that costs a few dollars to make sells for $300, and buying the same style from a cheap online site gets you most of that money back.
Image source: Fair_Assist1, Getty Images/Unsplash (not the actual photo)
#25
Most people overpay for bourbon. A lot of the mash bills are the same between brands, and there is a massive amount of contract distilling and stock trading going on between the brands. Most of the flavor is happening during the blending phase of production and the source material, meeting legal standards, is largely irrelevant.
So quit being the idiot bragging about the “super rare” bottle you snagged for 3 digits.
Image source: Girion47, Adam Jaime/Unsplash (not the actual photo)
#26
I worked for a giant roofing company that specialized in metal roofs. We’d sell you an admittedly very good roof – for easily five times what you could get the same product for elsewhere.
We’d start by “inspecting” your roof. Taking close up photos of every little issue we could find. One shingle with exposed fibers, a little ambering, God forbid we find a single cateye leak in your attic. We’d convince you that your roof was on the verge of collapse and you’d need it replaced YESTERDAY.
After inspection, out comes the iPad. We had so many statistics. Some things we were just trained to straight up lie about (misstating the cost vs value report as being based on a 2000 sqft roof not 3000 to skew the average) so that way we’d make you think we’re just a little on the high side of average.
Then product demo. We’d convince you there’s two kinds of roofs: bad three tab shingles with tar paper, or us. Either get a bad five year roof or our permanent one. Those are your choices.
So you know you need it. You want it done right, don’t you? So let’s make a monthly payment work.
Then our price comes out. $3000/square easy, but just a few hundred a month! To protect your biggest investment!
Oh, it’s too much? Begin a practiced sequence of predetermined price drops with entirely fictional justifications. “Flex install.” “Marketing incentive.” “I can get you our memorial day discount too, but only if you sign up today.”
That was crucial. Decide now, today, sign here and here. We had to – none of us got paid if you didn’t. You could call back the very next day and agree to buy, and sure our boss would get paid but we wouldn’t.
Never buy from a one-call-close contractor. I’m not saying their work is bad, those giant companies DO do good work. It just shouldn’t cost you $90,000 for an average sized roof.
Image source: Plastic-Coyote-6017, Getty Images/Unsplash (not the actual photo)
#27
Electronics warranties for anything that cost less than $250. Anything that would reasonably be covered by warranty would be noticeable within the first few weeks of having the product and would therefore be covered under the merchant’s warranty.
Image source: JakobWulfkind, Jass (akajassd) Hernandez/Unsplash (not the actual photo)
#28
Pet insurance is pretty bad. The type of insurance is called annually renewable, which means every year and can renew but your premiums go up. By year 8+, when you really need that insurance, it could easily be 250+/mo. You really should have a proper emergency fund before getting a pet and discuss with your family what exactly is an emergency when it comes to their Healthcare.
Image source: Due-Cup1115, Kateryna Hliznitsova/Unsplash (not the actual photo)
#29
Any time you see “Unlimited” data plans (phones, Wifi, etc.), it’s not unlimited. There’s always a cap. The cap is higher than any of the other plans offered, but you can run out if you have high usage.
Image source: bigpudding4, Getty Images/Unsplash (not the actual photo)
#30
Former academic advisor of a public 4-year university in a STEM college: taking prerequisite classes at the 4-year university instead of a local community college. The prereq classes were huge (~100-300 students depending), interaction with the instructors was mostly with TA’s, and the cost of tuition was 3x what it was at the community college. Instructors at a CC typically have no research requirements meaning their main job responsibility is teaching, compared to 4-year instructors whose workload might only be 30% teaching – so the CC instructors actually have time and bandwidth to get in depth with answering questions and being helpful to students.
I had so many students who struggled with the big classes and took on crazy amounts of debt retaking classes at the 4-year when they could’ve taken the exact same class for way less down the road and had a better learning experience and grade at the end.
Seriously, if you’re a college student in a tough major, look into options for taking your classes at a community college instead. Most universities will have transfer agreements and accept the CC classes (if you take the right ones, so do this with assistance from an advisor).
Image source: FutureShiner, RUT MIIT/Unsplash (not the actual photo)
#31
Directv protection plan, everyone gets it whether you asked or not. Your bill will increase by 15 to 30 dollars per month. Almost no customer realizes they have it and if equipment breaks the customer has already replaced with no deductible or hassle. We usually prey on the elderly. Kids watch out for your parents and grandparents.
Image source: zepol68
#32
I worked for a year for a large pawnbrokers chain. When selling your gold, they will always massively undervalue the price per gram of the gold when valuing it, playing on the sellers desperation for money to buy the item as cheaply as possible.
Now you may think fair enough, that’s what business do, but at the time I worked there, 9K gold was roughly £10 a gram and the company wanted us to pay £3.50 per gram. I personally made the company £2.5M profit in a year just from using this tactic to exploit the poor and needy. The worst bit is, I’m an engineer and only worked there out of desperation during the recession when the industry where I lived died, and the people coming in to sell their valuables were no poorer than I was, so I quit because I hated the fact I was being paid to exploit people at their lowest moments.
Image source: SouthCulture6230
#33
Supplements, nearly all of them. And it’s not even the ‘snake oil’ claims, who knows what ingredients and impurities are actually in them?
By definition, there is no evidence that supplements are beneficial for your health. It’s all marketing, preying on those less intelligent folk who are skeptical of real medicine, and vague statements like ‘supports heart health’.
It’s absurd how big the supplement industry is considering how bogus they are.
EDIT: to be clear, I’m not talking about legitimate vitamin and mineral supplementation for those are who have some specific deficiency. If you’re low in blood iron levels, you should probably take some iron (not a doctor), or just eat some meat and green leafy veggies.
And to everyone claiming supplements are actually really helpful, feel free to cite (any) evidence supporting your claims!
Image source: Trash_Man_Jones
#34
I don’t work in the industry but I make skincare at home. I now understand what a total and utter rip off the beauty industry is. I just backengineered a 450 dollar cream and it cost about 3 dollars to make at home.
Image source: sarahakld
#35
Foaming/liquid soap is a total scam. Buy bars, make your own liquid/foaming soap, and save tons.
One bar of soap fills a 95 mL bottle with concentrated liquid soap. Add a couple drops of essential oils for scent. You can use several old hand soap pieces for this instead of a fresh bar, just make sure the weight is comparable to a new bar.
Two bars of soap fill a 2L bottle with foaming soap refill mix. Add 5-6 drops essential oil for scent and mix well.
Image source: describe_one
#36
I sell electrical supplies
Find an electrician that is willing to only charge for their work while allowing you to buy the supplies (wiring, breakers, etc)
Why? Cause they buy a breaker for 10 dollars and charge you 15 on top of charging you to install it.
Image source: nWo5lyfe
#37
Dunno about other countries, but every time you go to a pharmacy in Australia, utter the magic words “generic version if you have them, please”. You’ll save thousands over your life.
Image source: DwarvenFreeballer
#38
Estate planning. 90%+ of the estate planning docs that I prepped as a paralegal were the same form, prepared fill in the blank style. Only wealthy people or those with very special circumstances like a disabled adult child need special planning, trusts, etc. People like to think that their situation is more special than it is.
Image source: been_blissed
#39
Video game demos are often vaporware. A bunch of work that cannot be used in a production environment.
Image source: Otherwise-Relief2248
#40
Science journals. The public pays the research, pays for the submission to the journal (a few 1000s € per paper), pays for researcher to edit and peer review and then has to pay to read that research.
Image source: Cornelius_Physales
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