Pod Insights The Clark Howard Podcast 07.16.25 Retail: Point Of No Returns / The Home Improvement Market Now About this episode You bought it, you wore it once, then sent it back. Maybe you just changed your mind. In addition to online purchases necessitating more returns, there are those gaming return policies. Clark predicts how this challenge for retailers will become costlier for consumers. Also - Is now a good time to tackle a home improvement project? There’s something going on in the market you need to know. Retail Returns Costly: Segment 1 Ask Clark: Segment 2 Home Improvement Decision Making: Segment 3 Ask Clark: Segment 4 Mentioned on the show: 15 Items That Can't Be Returned to Amazon 3 Reasons You Should Never Book a Nonrefundable Hotel Room The Only Reason You Should Make an Improvement to Your Home Americans delay home improvements in latest blow to US housing market Certificate of Deposit (CD): What Is It, Best Places To Open One What Is a CD Ladder and When Is It a Good Idea? CD Ladder Calculator - Clark Howard How To Freeze and Unfreeze Your Credit With Experian, Equifax and TransUnion Clark.com resources Episode transcripts Community. Clark.com / Ask Clark Clark.com daily money newsletter Consumer Action Center Free Helpline: 636-492-5275 Learn more about your ad choices: megaphone.fm/adchoices Learn more about your ad choices. Visit megaphone.fm/adchoices
Transcript 0:00 Speaker 00 Your sausage McMuffin with egg didn't change, your receipt did. The sausage McMuffin with egg extra value meal includes a hash brown and a small coffee for just $5. Only at McDonald's for a limited time.
0:12 Speaker 01 Price and participation may vary. Promotion pricing may be lower than meal pricing.
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0:50 Speaker 03 It's my pleasure to welcome you here to the Clark Howard Show. You know, our mission is to serve you with advice and information that empowers you to make better financial decisions in your life. Did you buy something, wear it, and then return it for a refund after you wore it? Maybe you just changed your mind. There's a lot of gaming going on right now of returns. It's really, really causing a mess for retailers. I want to talk about that. And then something you want to do to your home with the economic uncertainty right now? Should you be doing it right now?
1:30 Speaker 03 I have weird counter advice on whether this is a good time for renos and additions to homes. So returns are creeping up towards a trillion dollars a year total for retailers. And as best anybody can guesstimate, you got somewhere 15 to 20% of those that are anywhere from completely fraudulent to people gaming the system. And so this is a harsh dilemma for retailers. Because you always have this thing where policies are designed for the small percent
2:12 Speaker 03 of people who are running a game on you instead of the overwhelming percent of people that are doing everything honest and above board.
2:24 Speaker 03 Except that what's going on with returns goes way beyond a percent or two of people doing stuff. If we're at a point that 15 to 20% of returns may be in some way crooked. This is bad. And so this is a real, real challenge for you to be aware of. And one of the things is returns are a lot higher on things purchased online than things purchased in a store. So you may start seeing price discrimination in reverse.
3:06 Speaker 03 Because if you think about so long with online shopping, online shopping was cheaper on equivalent goods than going to a physical store. But so many problems are happening with bad credit cards, you know, stolen credit card numbers, and people legitimately, particularly with clothing, buying things online. And they thought they, you thought they were right when you bought them online, but when you get them, you say, oh, this doesn't look like I thought. It's not as nice as I thought. Colors off some, whatever. And then it causes a return that increases costs in the system.
3:50 Speaker 03 So we're moving into a different era. I'm making a prediction here, and I think you're going to see price discrimination moving the other way, where you may actually see lower costs on items in the physical store than you do in some categories, buying them online. You may see tighter policies. As we had this last Christmas, we had tighter policies than we'd seen in prior Christmases on returns. And you may see more businesses experiment with
4:29 Speaker 03 You get this price if you give up your right to return. You get this higher price if you want a right to return. Have you seen that any place you've shopped online yet?
4:41 Speaker 04 Only like hotel rooms and things like travel things.
4:43 Speaker 03 Gosh, I hate non-refundable hotel rooms. I hate non-refundable hotel rooms. Don't book non-refundable hotel rooms.
4:50 Speaker 04 Well, unless it's like the day before, right?
4:52 Speaker 03 Right, right. One of my brothers keeps booking non-refundable hotel rooms because he can't give up the lower price.
4:59 Speaker 04 You did price line bids forever.
5:01 Speaker 03 I did. And I learned.
5:04 Speaker 04 What happened?
5:04 Speaker 03 Well, they don't do bids anymore.
5:06 Speaker 04 I know, but I'm just saying like.
5:07 Speaker 03 Yeah, but in my brother's case, he booked hotel, trip canceled, lost the money.
5:16 Speaker 03 And I mean, it's just your choice. But anyway, back to, back to what we're talking about. The return thing, nobody's come up with the right answer yet. Between punishing your customers that just legit have a reason. My sister-in-law ordered a bed sheet set online. And it was, in the picture, it was this light blue color she really was attracted to. And then they came and they were a dark, almost purplish blue color. She sent me a picture and we looked at what they actually showed up as. And what they showed online weren't even close. That's a return.
6:00 Speaker 04 Yep.
6:01 Speaker 03 I mean, this stuff is not easy. And I'd say that particularly with clothing. If you don't like the hassle of returns, buy clothes in person.
6:13 Speaker 04 I usually, if I'm going to buy online, I'll buy from a place that, other than Amazon, where they have physical stores I could return to. So if I get a deal online, then I'll walk it in and return it. I do that too.
6:26 Speaker 03 I never told you I had the craziest thing with an Amazon return.
6:30 Speaker 04 What?
6:32 Speaker 03 I bought a blanket. We actually have this blanket now. It's really good, but it came, somehow it got horribly stained in shipping. The package had been ripped.
6:44 Speaker 04 I think you did tell me this one. You might have told it on the podcast, but go ahead.
6:47 Speaker 03 Well, I don't know if I told the follow up. So I told the story about returning it. Amazon says they never got it and charged me back for it. And when you drop off at the whole paycheck, they don't, they don't give you a receipt that you returned it.
7:03 Speaker 04 They scan your barcode. Yeah.
7:05 Speaker 03 What do I do about my money? I'm out.
7:07 Speaker 04 I'm surprised because I've done that at Whole Foods a million times and they, when they scan it right there, they should know you've turned it, returned it. That's really weird.
7:16 Speaker 03 They billed me back saying I didn't return.
7:17 Speaker 04 You didn't put it in a locker? You, you went to the person?
7:20 Speaker 03 I went to the person who was so hazmat about it.
7:25 Speaker 04 Wow.
7:25 Speaker 03 Because it was, it was soaked in something.
7:28 Speaker 04 Gross. Okay.
7:30 Speaker 03 Yeah. Do you know how, you know how much the blanket was?
7:32 Speaker 04 How much?
7:33 Speaker 03 It was $36.
7:35 Speaker 04 Wow.
7:36 Speaker 03 That's a lot to spend for a blanket, at least for me.
7:40 Speaker 04 All right. We'll go to another weird Amazon issue from Whitney in Virginia. I am a financial counselor. One of my clients had an issue I was hoping you might be able to help me with. They ordered soy sauce bowls for their wedding. In the package with the same tracking number, instead of the soy sauce bowls, they found a brand new MacBook Pro. Their Amazon account says that soy sauce bowls were delivered. I don't believe that the Amazon policy requires them to send it back. However, should they be concerned about what's on the computer? Any advice would be greatly appreciated.
8:11 Speaker 03 No, no, if it's a brand new Mac, MacBook Pro, this is just somebody messed up in the warehouse and
8:20 Speaker 04 Big time.
8:21 Speaker 03 I would say, I mean, now you're asking me an ethical question. Whitney, I think they need to contact Amazon customer service and see if they got customer service or customer no service. And that reminds me of the time that walmart.com didn't charge me for a bike and I couldn't get them to take my money. And I had this bike and I felt like I had ill gotten gains and I could never get Walmart to come up with a way to take the money when they hadn't charged me for the bike. At the very least, they should contact Amazon and see if they can work this out because they obviously soy bowls were a lot cheaper than a MacBook Pro.
9:02 Speaker 04 Jolene in Missouri says, I have a vacant lot in another state that I want to sell. I've gotten lots of letters which offered to buy the property. What is the safest way to proceed and how do I safely get the money for the sale deposited into my bank account?
9:16 Speaker 03 Don't take those letters seriously as being real. People may have been to Dare to Be Rich seminars and they're not going to tend to offer you a fair price for the vacant lot. You need to hire, I mean, you're talking about in another state, you're not there. If you want to sell the lot, you need to hire a real estate agent who does land sales regular. If it's, you don't say if it's a residential lot or commercial. If it's a residential lot, you hire a traditional real estate agent. It commissions out at 10% usually for a raw land sale.
9:58 Speaker 03 If it's something that would be considered to be commercial property, you need a commercial agent. Don't proceed at all. There is no safe way to proceed with you in one state and getting UFO letters in another. Don't even think yet about how you're going to deposit the money. I'm not trusting any of this, doing it in the scenario you described.
10:23 Speaker 04 I'm pretty surprised 10% commission on land. It seems like you'd need-
10:27 Speaker 03 Historically, land is a more difficult sale and there's not as much money often in a land sale. So in a lot of the country, it's traditional and wherever state this in is maybe-
10:42 Speaker 03 Overestimating, but it's more common there would be a 10% commission on the lay on sale.
10:49 Speaker 04 Okay. Steve in South Carolina says, Clark, please settle a loving dispute. Husband says it's a great time to upgrade a 2023 Bolt EV 2LT at 22,000 miles with a 2025 newly redesigned Tesla Model Y. He says going forward, repair parts for accident repair or breakdown are going to be hard to get for the discontinued Bolt. And the $7,500 tax credit for the Tesla is going to disappear soon. The Tesla is far superior, larger, greater range and much faster charging speed and Carvana is offering to buy the Bolt for $20,000.
11:22 Speaker 03 20,000?
11:23 Speaker 04 Just $4,000 less than the Bolt originally cost. The wife says that the Bolt is perfect, no issues at all, parked in a garage and is running great. Upgrading would cost $24,000 cash after trade in, which is crazy expensive. What do you say, Clark? New Tesla or keep the Bolt?
11:40 Speaker 03 Well, um, the technology difference is so much between the 2020 Bolt and a 2025 Tesla Model Y that it's almost like comparing apples and oranges between the two vehicles. So it would be an unusual cycle to sell a two-year-old vehicle. If it's cost $4,000 effectively to drive a Bolt for two years and you're out and then you're a free agent to buy someone, something else. This becomes, Steve, a lifestyle question.
12:23 Speaker 03 Because obviously the Bolt's going to get you point A to point B. I'm not that worried about the parts availability as one of you may be. I'm not worried about any of that stuff. But they are completely different driving experiences. Not to mention because the reputational harm Tesla is under right now. They're having to discount vehicles in ways they never had. So you're going to get. A really decent deal on the Model Y, plus the $7,500 tax credit is still in place. Is it a lifestyle purchase that's unnecessary?
13:05 Speaker 03 Yes. Is it a good deal for a lifestyle purchase that's not necessary? Absolutely. So I'm not going to say that from a dollars and cents standpoint, yeah, you should do this, but I am going to say this is a great time to make that lifestyle decision because the dollars will never work as well as they do right now. I don't know if I made the argument, friendly argument, loving argument, more difficult to decide or what you decide to do. Coming up ahead, something else that costs money.
13:47 Speaker 03 Doing improvements, additions, renovations to your home. I want to talk about that.
13:54 Speaker 00 Your sausage McMuffin with egg didn't change. Your receipt did. The sausage McMuffin with egg extra value meal includes a hash brown and a small coffee for just $5, only at McDonald's for a limited time.
14:06 Speaker 01 Price and participation may vary. Promotion pricing may be lower than meal pricing.
14:09 Speaker 02 They're running a cover two defense, but you're running to get game day deals on Uber Eats. Keep everyone at tonight's watch party fed with deals from your go to restaurants or stock up with deals on your favorite snacks and groceries. Whatever the occasion, get game day deals on Uber Eats all season long. It's not football without food. Uber Eats. Order now. Terms apply. Product availability varies by region. See app for details.
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15:40 Speaker 03 The uncertainty in the US economy right now that has been caused by the ongoing tariff stuff has made an impact on home renovations, additions and improvements. You look at the suppliers to the home reno industry are reporting weak sales pretty much across the board. Home Depot in its guidance to the investment community is reporting very weak what are known as comps. That's what their sales are doing versus a year ago. Not every reporting period, but generally.
16:18 Speaker 03 And so we're in a time that people are nervous, let's call it that, reluctant, afraid, whatever, to proceed with home improvement projects. And dial back a little while ago, the big thing was you couldn't even get a home renovation company to call you back. And the price quotes they were giving were through the roof. You know, things like this go through waves, they go through cycles. And so if your finances are good in your household, your job is solid.
17:01 Speaker 03 Your debt levels are where they should be. Your savings are secure. You're in good shape. If you're all those things, then this is actually a better time than in recent times for you to look at doing a home renovation because so much of it is the labor cost and the markup that the company puts on the work it does. If they're hungry or for work, the quotes you get are better. And that just goes to follow. And yes, there's some higher materials costs built in because of products that are being affected by tariffs.
17:44 Speaker 03 But the overall effect is so much about what you're paying in markup for the work that's being done. So if there's something that you've been hungering to do, and remember you meet those checkmarks I was talking about, about your financial house being in order. Want your financial house in order before you do stuff to your house. But if you've got all those things in place, as they should be, this is a time I think it's good for you to zig when other people are zagging and see what kind of prices you
18:23 Speaker 03 can get on getting that improvement, addition, reno, whatever it is, done at your house. One thing about any of this, though, don't fool yourself by saying, oh, this is going to make our house so much more valuable. The reality is almost every improvement you can do to your house will cost you more than the increase in value it will cause for your house. So this is a lifestyle choice to do improvements to your home. It just may be more favorable conditions for you to do it right now than it's been in recent years.
19:04 Speaker 04 Okay, we'll go to questions. Mark in Florida sent this one in. I'm one of the lucky ones that had a pension. I left the company back in 2013. I'm now 63 years old. My question is, when is the best time to start taking my pension? I plan to stay at my current employer for two more years and then retire. Should I wait or start taking it now? My wife is concerned that if something were to happen to me before I start taking it, nobody will get the pension. Any suggestions? And FYI, I love your show. Every Saturday, I sit on the beach with my friend and we listen to your shows from the week.
19:37 Speaker 03 Wow. Okay. I love going to the beach. Anyway.
19:42 Speaker 04 And I gave you the name of the company. I know you're familiar with it.
19:44 Speaker 03 I am familiar with their pension because we've had questions about it. Employees now don't get a pension there. The pension that you have, and this is particular to individual pensions, there's not much of a haircut each year you take the pension earlier. However, if you do wait two more years till when you retire, it does mean the pension will be a little beefier for the entire remainder. There is no inflation adjustment on this pension, as most pensions don't have in the private sector, where there's a cost of living adjustment each year. So I
20:25 Speaker 03 hope you're in good health. Go to the beach every week and hang out. I bet you are 63. And this pension, like most, has a provision where you can do for your spouse, life of you plus 50%, life of you plus 100%. So your wife will be protected over the years ahead if you die before she does at either 50% or 100%. Most pensions, you've already made that or have the ability to make that election as a retiree not taking the pension yet.
21:05 Speaker 03 And so just confirm that for your wife that don't worry, she's already taken care of. If you were to out of the blue, hopefully not happen, die before you would take a pension at 65. As long as she's already protected in the plan document for the pension, I would wait the two years because your need for the money is going to be greater two years from now when you're retired from, from work than the need for the money right now. But again, it's not like social security on most private pensions where there's a huge advantage for every year you delay taking social security. The actuarial for private pensions usually
21:50 Speaker 03 has a relatively small penalty. Year by year, you don't wait till age 65.
21:58 Speaker 04 George in Massachusetts says, I have little finance education. I heard about a CD ladder. How do you invest $15,000? What institution or bank has the best offers?
22:08 Speaker 03 All right, George, this is a great question. I will point out to you that CDs are a saving instrument. It's not investing because you're not going to lose any money, but you're also not going to get a great amount of money on the money you make in the CD. So a CD ladder, a classic CD ladder is you would take your $15,000 and you put $3,000 in each of five steps on the ladder. A one-year CD, two-year CD, three-year, four-year, five-year. And normally, when you go out longer, you're going to get a significantly higher interest
22:49 Speaker 03 rate on the CD. Because of worries about us having a recession going forward, the ladder is not as lucrative for the later years as it normally might be. But in order to build one, you can go to bank rate where they have an up-to-date list of the best rates they've been able to find on one-year, two-year, three-year, four-year, five-year. And I would say having to open them. At different institutions gets a little bit of a hassle. So if you find an institution that is near the top or at the top,
23:33 Speaker 03 one category after another, just open all five with that one. And do your ladder of the 3,000 each, one, two, three, four, five years.
23:42 Speaker 04 Bob in South Dakota says, I plan on retiring outside of the United States. I love, I have my credit frozen. Will I have any issues thawing it in the future?
23:51 Speaker 03 None. I assume you'll, you'll still have financial accounts in the United States, credit cards in the United States. You'll have everything going on here. You know, your sign in for your credit freezes for the credit bureaus. It's going to be really easy for you to freeze and thaw from outside the United States. There's no reason, Bob, I know of at all that you would have trouble with that. One thing that is more difficult when you first locate overseas is navigating all the stuff with, with accounts.
24:34 Speaker 03 How you're going to pay for things, how you're going to receive money, how you're going to provide for health coverage. And I don't know where in the world you're planning to do your retirement. But I want to tell you that there are lots of groups now of expats who've retired in various communities and various countries around the world that help each other, that help their fellow Americans who choose to retire outside the United States. And you'll find a lot of very, very good, useful information for you about navigating the various processes you have to do
25:15 Speaker 03 for locating in the community and the country you're going to move to and navigating all this other stuff. That's involved with having a life that was here and now will be there wherever there is. And so many Americans are doing what you're doing either for a lifestyle reason, or because your money goes so, so much further in so many other places in the world. If you're living on a fixed income in retirement, it's amazing the lifestyle you can have in so many other places versus what you can have here in the United States.
25:57 Speaker 03 If I were to live anywhere in the world, though, oh, man, if I lived outside the United States, I would live in one of the places that's more expensive to live in than living in the US. I would get no savings from it. Krista, do you have any idea what country it would be that I would want to live in?
26:19 Speaker 04 Italy?
26:20 Speaker 03 Nope, that's where Elaine would want to go.
26:22 Speaker 04 Oh, well, outside the United States. I don't know.
26:26 Speaker 03 Australia.
26:27 Speaker 04 Oh, wow. Australia is awesome.
26:29 Speaker 03 I would absolutely want to live in Australia. No doubt. Just go through the drive-throughs backwards. That would be my place. But it is an expensive place to be.
26:43 Speaker 04 Mm hmm.
26:44 Speaker 03 Whoa. And one fantastic place. Anyway, that would be my dream. So I guess we'd have to split our time between Italy.
26:56 Speaker 04 What a difficult time, thing that would be.
27:00 Speaker 03 Australia. Now, Elaine gets to Italy, and she literally feels like she's home. Her genetic test says she's 7% Italian. That's not right. Because when she's there, she's 100% at home. And I'd weigh 8,000 pounds living in Italy, probably. Well, thank you so much for joining us on today's podcast and YouTube show. I hope that something today was enjoyable, informative, and actionable. We should be those three things, shouldn't we?
27:37 Speaker 04 We should.
27:38 Speaker 03 So have a great one, and we'll see you next on Clark Stinks.
27:43 Speaker 04 Yes, yeah.
27:44 Speaker 03 Clark Stinks coming your way.
27:50 Speaker 00 Your sausage McMuffin with egg didn't change. Your receipt did. The sausage McMuffin with egg extra value meal includes a hash brown and a small coffee for just $5. Only at McDonald's for a limited time.
28:02 Speaker 01 Price and participation may vary. Promotion pricing may be lower than meal pricing.
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