Central Bank of St. Louis

  •  A smart pig on a stack of books
  • 4 reasons to be wary of infomercials

    If you’ve ever been at home watching T.V. during the day or late at night, chances are you’ve been forced to sit through a cluster of infomercials.

    infomercial-man

    Most of them are goofy and easy enough to write off. But there’s always that one that sticks out in your mind that makes you think, “Yeah. I could sure use that!” But before you pick up the phone, there are some points of which you should be aware when it comes to ordering from an infomercial.

    1. Take out the middle man.
    Before buying a product off an infomercial, check online to see if you can track down the retailer that makes the product. Often the infomercial company will mercilessly upcharge the product and then gouge your wallet on shipping costs. So just take out the middle man, and get that “must have” product for a lower cost, with less risk factor from the original retailer.

    Woman looking at her phone in shock.Be sure to monitor your bank accounts for suspicious activity.

    2. Mission impossible: returning the product.
    Let’s say that you order a product from an infomercial but it doesn’t work out. You had a supposed “30-day guarantee” for your full money back, but what they didn’t mention is that it would not include the outlandish shipping fees. So, you end up paying twice the amount of shipping fees. Not only have you expended a lot of effort, you’re out a lot of money.

    3. Negative Option.
    Weeks after buying something off an infomercial, you check your credit card account to find that after the first charge, you have multiple payments made out to that company! When you call to inquire about the charges in question they tell you that it’s payments for the continual service. Unknowingly, when you initially bought from them you signed up to receive either continual shipments of their product, or even enrollment into an “exclusive members” club that charges you every month. This deal would have been in the fine print, which you automatically get signed up for after buying from them the first time. This system of money-making is called Negative Option, which the Federal Trade Commission defines as: “a category of commercial transactions in which sellers interpret a customer’s failure to take an affirmative action, either to reject an offer or cancel an agreement, as assent to be charged for goods or services [1].”

    4. Understand the terms for a free trial.
    Yes, a free trial is a convenient elimination to a barrier of entry; however, it’s important to make sure you understand the terms and conditions of your “free trial” before you agree. In most cases when you sign up for a free trial, the company will ask for payment information. The details are often hidden in the terms, but by simply giving them your card information, you are authorizing the charge for after your free trial is over. Be careful to thoroughly read and understand the terms and conditions for the product or service. If all seems well to you, simply set a calendar alert in your smartphone to remind you to call in at the end of your trial period and cancel if you wish to discontinue.

    Buying from infomercials cost you more than just the product, save your money, and hang up on that 1-800 number. Infomercials may snag your attention, but don’t let them snag your wallet! Sometimes it’s best to pass up on that “must have” item.


    [1] Negative Options, Federal Trade Commission (FTC)



  • The information provided in these articles is intended for informational purposes only. It is not to be construed as the opinion of Central Bancompany, Inc., and/or its affiliates and does not imply endorsement or support of any of the mentioned information, products, services, or providers. All information presented is without any representation, guaranty, or warranty regarding the accuracy, relevance, or completeness of the information.