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Welcome

t’s holiday time, and you know what that means. It’s a time for celebration, relaxation and catching up with friends and family – and possibly eating and drinking too much. But for many, it’s also a time of shopping – not just battling the crowds in bricks-andmortar stores, but also increasingly jumping online and clicking up a buying storm. Whether you’re planning on stuffing your stockings via your laptop or instore the traditional way, we’ve outlined some of the common traps to beware as well as offering tips on smarter shopping. Being armed with information is essential to standing your ground and not taking no for an answer when retailers and manufacturers want you to. And that’s where CHOICE comes in. So happy shopping from all of us! Zoya Sheftalovich, CHOICE investigative journalist

Contents Refunds & your rights

Don’t take no for an answer

Warranties 8 Should you buy that extended warranty?

Online shopping

Browse, choose, click – done! But there are some traps to beware

Digital downloads

Work around the pricey roadblocks that online international traders set up for Aussie shoppers

Interest-free deals

Did you know? Regardless of lapsed warranties, consumer guarantees require a product to be of “acceptable quality” throughout its reasonable life

Buy now, pay later – in spades. So what are your alternatives?

Gift cards

The gift that can keep on taking

Managing your debt

Get the debt monkey off your back once and for all

How CHOICE can help you

Find out why you should sign up and become a member today

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Refunds & your rights It’s a common problem.

for its normal purpose and

You give or receive a

cannot be easily fixed within

present, unwrap the

a reasonable timeframe; or it

packaging and discover

is unsafe.

it’s broken or doesn’t work.

For minor failures, the

Or, it fails to perform in

seller may choose to offer

the way it promised. Or, it

you a refund, replacement

stops working a few days

or repair. This must be

after the warranty expires.

provided free of charge and

So where do you stand

within a reasonable time

if you need to return

period. In this case you can’t

something?

immediately reject the goods and demand a refund – you

Major or minor?

must give the supplier a

For gifts with major failures,

chance to fix the problem.

you may reject the goods and

Minor failures include small

breaches of your rights:

This length of time can often

get a refund or an identical

problems with products that

be longer than the warranty

replacement. Under the

do not fit into the major

No refund – store credit only

Australian Consumer Law,

failure categories, such as

Consumers are entitled to a

of an expensive product such

there is a major failure with

loose threads on clothing.

refund for products found to

as an oven or fridge.

a product when: you would

You don’t have the

Watch out for these common

throughout its reasonable life.

period, especially in the case

have a major fault or failure.

No packaging = no remedy

if you change your mind,

Out of warranty = no remedy

it is significantly different

although many retailers will

Regardless of lapsed

or negated just because you

from the description, sample

offer you this option if you

warranties, consumer

haven’t kept the original

or demonstration you were

return the product within a

guarantees require a product

packaging of the product

shown; it is substantially unfit

certain time period.

to be of “acceptable quality”

you’re looking to return.

not have purchased it had you

automatic right to a refund

known about the problem;

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Your rights are not affected

Warranties All goods for sale in

manufacturer’s warranty has

– usually one year for TVs

Australia come with a

expired after say one year.

and up to three years for some

consumers are being pressured

LCD and plasma models. And

by sales staff to buy extended

statutory warranty. This

A CHOICE survey revealed

means that goods should

Extended rip-off

contrary to common belief,

warranties. If this happens to

function properly for a

This is the third type of

most products, especially

you, you can always come back

reasonable period, bearing

warranty available in Australia

big-ticket items such as

with a witty rejoinder about

in mind their price and the

– and also the shakiest.

washing machines and

their confidence in the product

TVs, are quite reliable.

they’re selling while you

way they were described when you bought them. This is different from a

You’ve probably found yourself in this situation: just

Secondly, if something goes

politely decline.

before you get ready to pay

wrong with your TV outside

manufacturer’s warranty

thousands of dollars for a new

the warranty period you

confident that you’re already

(also known as a voluntary or

TV, the salesman asks if you’d

may be covered under the

covered by the Australian

express warranty), which is

like to take out an extended

statutory warranty.

Consumer Law.

usually provided as a booklet

warranty. He says it will

that comes with the product,

give you another four years’

but may only be available in

protection should anything go

certain circumstances, and is

wrong and will only cost an

often for a limited time.

extra couple of hundred dollars.

Your right to compensation

At that point the extra

is not limited to the period

money doesn’t seem much to

of the manufacturer’s

help protect your expensive

written (express or extended)

investment, so you agree.

warranty. So if, for example,

After all, it’s good to have

a fridge develops a major fault

some extra protection, right?

after just 18 months, it is still

Not necessarily. Most

reasonable to expect a refund

appliances are covered by

or replacement – even if the

a manufacturer’s warranty

In the meantime, you can be

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Online shopping Traditional

If something doesn’t look

Get unblocked

Microsoft and Amazon, based

bricks-and-

right, click on the padlock

Restricting access to content

on their IP address.

mortar stores

to view the SSL certificate

based on geographic location

Third-party delivery services,

are slowly but

and check the owner matches

is a popular strategy used by

such as MyUS.com, Lil’ Shoppa,

steadily being

the online shop and that the

multinationals so they can set

Bongo and Price USA, remove

left behind as

certificate has not expired.

different prices in different

physical shipping barriers.

regions of the globe.

From computers to clothing,

more and more

• Don’t use the same

Australians go online to

password for different

shop. But there are some

sites, and create strong

of geo-blocking is common

you purchase the product,

traps for young players of

passwords with a combination

for Australian consumers,

enter the warehouse address of

the online shopping game.

of letters and numbers.

who are often charged hefty

the parcel-forwarding service

mark-ups on products from

you choose, and wait until

companies such as Apple,

they redirect the mail to your

Online fraud-busting

• Never give your personal password to

• Have up-to-date antivirus, anti-malware,

Australian address. Some of

on your computer.

these companies, for example

•

business that helped you set

research the company, read

it up. Legitimate businesses

buyer reviews, call the contact

don’t ask for security details

number, and check the refund,

via email or phone.

returns, privacy, delivery and

If a website is unfamiliar,

Price USA, even buy the product on your behalf.

guarantee policies.

that encrypt your payment

• Always double-check

details. You can tell by the

that the domain name

https:// in the address bar

matches the website. For

(instead of http://) and a

example, www.cols.com.au

small padlock symbol on the

might be a fraudulent copy

bottom right of the browser.

of www.coles.com.au.

the basic principle is the same:

anti-spyware software

anyone, including the

• Only buy from websites

The frustrating reality

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Digital downloads Imagine a virtual tunnel

Netflix or Hulu webpage

cheaper US

from your lounge room to

while connected to a VPN

prices for Play

a computer in the US or

server in the US allows you

Station 3 online

UK capable of disguising

to successfully set up an

and Xbox LIVE

your IP address and

account if you use a legitimate

by purchasing

bringing you a constant

US postal address.

prepaid vouchers

stream of movies and TV

The alternative to using a VPN

that can be used

shows, as well as access

is to adopt a US-based domain

to add credit to

to heavily discounted

name system (DNS) server,

an account set

software downloads.

such as unblock-us.com, for

up via a VPN if

about $5 per month. Rerouting

you also use a

private network (VPN)

your internet connection

legitimate US

does. As a client connecting

through a DNS server – a

address.

to a VPN server that’s in the

simple configuration in your

same country as the site you’re

computer’s network preferences

Tuning in

attempting to access, you

– can also trick the site you’re

In the US

have unimpeded access

attempting to access into

iTunes store,

to services and purchases

believing you’re elsewhere.

the Beatles’ No. 1

This is exactly what a virtual

usually unavailable to

In the US iTunes store, the Beatles’ No. 1 album sells for US$12.99, yet Australians fork out almost 60% more

album sells for US$12.99, yet

Name of the game

Australians fork out almost

legitimate US address. To

The average cost of an online

60% more to buy it from an

get around the US credit

and paid VPN service providers

video game is 50% more in

Australian IP address. To get

card requirement, it’s possible

available online. Some of

Australia. Access to the lower

around this, you can set up a US

to make your maiden purchase

the popular options include

prices offered on the US version

iTunes account by altering the

a free app and later top up

TorVPN, LogMeIn Hamachi,

of online gaming service Steam

country setting automatically

your account with prepaid

Hotspot Shield, HMA, IPVanish

is difficult without a US credit

detected when opening the

US iTunes store gift cards

and Overplay. Opening the

card, but you can access the

iTunes store and entering a

purchased from eBay.

Australian residents. There are hundreds of free

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Interest-free deals As shopping traps go,

Buy now, pay later

long-term payment

You take your purchase home

Interest free, instalments payable

deals are as bad as they

and don’t need to make any

You pay off the purchase in

get. They can cost you

repayments or pay interest

equal instalments over the

hundreds of dollars in

during the interest-free

interest-free period. If you

fees alone, even if you pay

period. If you fail to repay

miss an instalment, interest

everything off within the

it (along with all the fees)

will apply not only to that

interest-free period.

within the interest-free

instalment but also to the

period, interest will usually

remaining balance of

Long-term payment offers

apply on the remaining

your account.

usually come in four

balance from the end of

different types:

that period onwards.

Interest free, with minimum payment required You pay a minimum repayment over the interest-free period and must pay the remaining amount before the interestfree period expires. If you miss minimum repayments, penalty fees will apply.

No deposit, four years to pay You pay off the purchase over four years, interest applies from day one and there is no interest-free period.

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HI, LAY-BY! An alternative to interest-free is lay-by, which allows you to select your presents before popular gifts are snapped up and avoid the lastminute crowds. And according to research, it’s enjoying a resurgence in popularity. As with an interest-free purchase, you can spread lay-by payments over several weeks or even months. But unlike with interest-free deals, you can only take the product home once it’s been paid off. On the upside, layby fees are much lower than those for interest-free and you’ll never be charged interest. You’ll usually pay a 10-20% deposit for the goods and a small service fee may apply. As interest-free deals usually require an application and ongoing fees, lay-by can cost much less. But it can become expensive if you change your mind, as the service fee and sometimes also the deposit may not be refundable if you cancel or don’t keep up the payments. However, should you just need a longer period to pay it off, retailers will often allow you to vary the payment terms if you ask.

Gift cards While gift cards and

most allow you to do so online

for this amount (such as a

vouchers make a

or via a dedicated customer

Christmas card), you have to

convenient present,

phone number, others require

buy something more expensive

they’ve been the subject of

you to check the balance

and pay the amount above the

numerous complaints to

in-store.

value on the card. Some also

CHOICE over the years.

can’t be used for a sale under

Did you know?

Shopping centre cards, such as Westfield’s, can be used in a wider variety of stores, but won’t be accepted by all stores in a Westfield shopping centre

Traps to watch for Expiry dates

Gift cards not honoured for transactions less than a specified amount

Lost or stolen cards

as Westfield’s, can be used in

Will the card be honoured after

You can’t use, for example, a

You normally have to treat your

a wider variety of stores, but

this date? A large number of

Dymocks gift card for amounts

gift card like cash – if you lose

won’t be accepted by all stores

card providers allow a grace

less than $5, so if there is

it, it’s gone. However, some

in a Westfield shopping centre

period (usually one month)

$4.50 left on your card and

retailers allow you to cancel and

– in particular, none of the

after the card has expired.

you want to buy something

re-issue a card you’ve bought,

Coles group (except Kmart),

Be especially wary of cards

sometimes for a fee. Hold onto

Myer or Woolworths group

that state only their issue date

your receipts for gift cards and

stores accepts it.

rather than the

jot down details such as the

expiry date (they

card number.

$10 or even $20.

usually also state

Will you get change? For most cards the answer is no, but you can use the card

for expiry after

Restrictions about which shops accept the card

the issue date).

You can usually only use a

full amount.

the time period

You should

again if you haven’t used the

gift card in a specific store or

also be able to

group of stores, such as the

Fees and charges Fees are

conveniently check

Coles Group & Myer gift card

mainly a problem with Visa and

the remaining value

and Woolworths Wish card.

MasterCard gift cards – most

on the gift card. While

Shopping centre cards, such

retailer cards have no fees.

Back to cover

Managing your debt Holidays are a time for

Australia. You can also check

payments or put the debt on hold

compare, ditch & switch

celebration, spending

the services listed on Financial

until you can start repaying it.

quality time with friends

Counselling Australia.

At CHOICE’s Compare, Ditch and Switch page, you can compare everything from home loans to credit cards. Search the entire credit card market in seconds and compare cards on rates, fees, balance transfers and more so you don’t end up stuck with a card that will bleed you dry.

and family – and sometimes

Creditors must consider your case and respond within 21

Circling debt consolidation sharks

days. If they knock you back,

If you do start to find yourself

Debt consolidation

Service or Credit Ombudsman

drowning rather than swimming

businesses advertise

Service can both intervene on

in debt, there are steps you

themselves as a quick way to get

your behalf.

can take to find yourself

the monkey off your back, but

back on shore.

you could end up paying more

racking up too much debt on the (not so) plastic fantastic.

Seek help from the

in the long run than you would

professionals Financial

dealing with creditors yourself.

counselling services provide

By law, you’re entitled to deal

a free, confidential and

with the creditor directly. Should

independent service to assess

you fall into debt, you have the

your situation and help with

right to ask your creditors to

solutions. They can assist with

revise the terms of payment

pleading hardship on your behalf

through a hardship variation.

and/or negotiating an agreement

You can also ask to revise the

with your lender, but they advise

terms if you simply don’t have

consumers to make the initial

the money to pay what you owe,

approach if they feel comfortable

but the terms of repayment may

doing that.

be more stringent. Through the

A list of counsellors in your

hardship variation, you may be

state is on the website of the

allowed to extend the duration

Insolvency and Trustee Service

of your debt and make smaller

the Financial Ombudsman

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