# The High Cost of Being Hopeless With Math

#### By Mary Hunt

October 30, 2017 5 min read

"I don't do math. Numbers give me a rash." That's a line I've used a lot, mostly because it's true but also because it gets me a laugh.

Truth be told, most of us stink when it comes to doing math on the fly. That's a problem because being hopeless with math makes us putty in the hands of retailers.

Why is it socially acceptable to say that we're bad at math but not to say we're bad at reading? The truth is that it's not OK to be hopeless with numbers. Here are three ways that our aversion to math costs us money:

THE NUMBER 9. Amazingly, 65 percent of all retail prices end in the number 9. Subconsciously, we're charmed into believing the item is a bargain.

Whenever you see a product priced at \$29.99 or \$9.99, the retailer is attempting to charm your brain by marking prices just below a round number. Because our brains are trained to read from left to right, the first digit is the one that sticks in our head and the one we use to decide if the price is right.

Both Steve Jobs, who came up with the 99-cent mobile app, and the guy in California who founded the 99 Cents Only Stores have made millions off this human quirk. Retailers use the number 9 to lure us into buying something because they know we'll assume it's been discounted.

This phenomenon is known as the "left-digit effect," and studies have shown that it absolutely works and has a big impact on our buying decisions. So whenever you see a price ending with 99, get in the habit of rounding up and then deciding whether it's a good deal.

The good news is that simply being aware of the ways retailers use the number 9 can break their spell over us. Whenever you see a price ending with a 9, stop and think about what's going on.

INTENTIONAL CONFUSION. It's a trick retailers use all the time: A confused customer is more likely to opt for the higher price. An item marked "5 for \$4" prompts us to buy five items for \$4 instead of one item for 80 cents, because it's too confusing.

Which is the better deal: Thirty-three percent off the regular price, or 33 percent more product for the same price? Studies show that most people go for the deal with 33 percent more because they don't know how to do the math and they simply guess. And they're wrong.

Thirty-three percent off is the same as a 50-percent increase in the quantity. Let me show you: If the regular price is \$1 for 3 pounds, 33 percent off means you get 3 pounds for 66 cents, or 22 cents per pound. If you opt for 33 percent more, you'll get 4 pounds for \$1, or 25 cents per pound. The secret is to figure out the price per unit — per ounce, per quart, per pound. Then, it's easy to compare.

PRICE IGNORANCE. In his book "Priceless: The Myth of Fair Value and How to Take Advantage of It," author William Poundstone tells the story of the retailer Williams-Sonoma and a \$279 bread-maker. Sales were lagging, so the retailer placed a nearly identical machine next to the \$279 bread-maker with a price tag of \$429. Immediately, sales doubled on the \$279 model because it appeared to be 40 percent cheaper and, therefore, a great deal. The same tactic is in play when you see a big display in the supermarket with a sign that reads "Special!" If you are not up on your prices, you'll fall for every trick retailers have up their sleeves to get us to spend more money.

Getting good with math, I'm discovering, starts with my attitude. That's why I am never again going to tell myself or anyone else that I'm bad with math. I'm doing brain calisthenics. And while forcing myself to figure out price per unit on the fly is a good exercise, I'm also learning that a pocket calculator is my friend.

Mary invites questions, comments and tips at [email protected], or c/o Everyday Cheapskate, 12340 Seal Beach Blvd., Suite B-416, Seal Beach, CA 90740. This column will answer questions of general interest, but letters cannot be answered individually. Mary Hunt is the founder of www.DebtProofLiving.com, a personal finance member website and the author of "Debt-Proof Living," released in 2014. To find out more about Mary and read her past columns, please visit the Creators Syndicate webpage at www.creators.com.

Like it? Share it!

• 0