America is often described as a ?throw away society?. We buy things?usually brand new?use them for a while, get rid of them in some form or fashion, then move on to the next thing.
This creates an enormous pile of stuff sitting somewhere?much of it of pretty good quality?and presents a real financial opportunity to anyone willing to invest some extra time and effort in buying what they need.
Why buy anything used? For one thing, new isn?t always better; sometimes we can get better quality merchandise second hand that we could never afford brand new. Sometimes, the item in question is one we don?t use that much, or won?t use for very long?why pay a premium for it?
But more important by far: any money we can avoid spending is money that can go either into debt reduction or directly into savings.
What are some items that are better bought used than new?
It can cost thousands of dollars to buy decent quality new furniture for just one room, and tens of thousands for an entire house. But you can often buy used furniture for ten to twenty percent of what it costs brand new which is also a way to get better quality furniture that you can?t afford to buy brand new.
Check out estate sales, garage sales, second hand furniture stores, your local newspaper or your company or neighborhood newsletter to see what?s available.
There may be tangible advantages to buying a brand new car, but the financial factors heavily favor used cars. For one thing, used car prices are much more negotiable, especially if you?re buying direct from the seller. Depreciation is another factor. The average new car will lose up to 20% of it?s value in the first year and 10% in each of the next four years which makes buying new a guaranteed money loser!
You only have a certain amount of money to put down on a car, new or used, but if you buy new, you will most likely make up the price difference by taking on more debt. Buy a used car and keep the loan to a minimum. Better yet, buy a used car you can pay cash for and skip the loan altogether. Driving it may not be such a rush, but your non-car life will be so much better for not having the debt that you might not care.
3. Car parts
If your car is at least five years old, you can save a small fortune buying used replacement parts rather than relying on new parts from a repair or body shop. You can find replacement parts on the web, and the availability is greater than most of us imagine. I recently paid $25 for a replacement taillight box on our van that would have cost at least $200 brand new.
My kids are out of the toy stage, but one thing we learned as they were growing up is that a toy, no matter how important it seemed at the time, was just a passing phase. And that phase can last as little as a few hours!
Here?s a little secret: kids can turn just about anything into a toy. The brand-new-in-the-box-from-the-store thing is but a momentary rush. They may play with it for a few days or a few weeks, but rest assured they will get bored with it and throw it on the heap with the other old toys. Buy used toys that way their phases won?t cost so much and put the money you would have spent on new toys into something more permanent, like their college fund.
The problem with clothes is that they aren?t permanent. Sooner or later they?ll either fall apart, go out of style or no longer fit. This is especially true with children?s clothes. So why spend so much money buying them brand new?
Thrift stores have clothing available for impossibly low prices, generally $3-$5 per article. Much of it is gently used, name brand clothing discarded by fashion addicts who got rid of it simply so they could make room in their closets for the new spring (or fall) lines. It takes patience and digging through the racks, but the savings are substantial.
If like most people you?re a weekend handyman why pay a premium price to buy a brand new tool you probably don?t use more than once or twice a year? I bought a good quality manual hedge clipper at an estate sale for $5 and have been using it 3-4 times a year to trim my hedges?for 15 years! I have many other tools that I?ve gotten at less than retail, but that one stands out in my mind.
A good quality tool can last for many years, whether you pay $5 used or $50 new. Unless you use tools in your occupation, there?s no need to have hundreds or thousands of dollars worth sitting your garage or basement.
My son got tired of the meals we prepare around here and borrowed a cookbook from the school library in the hopes of stoking our creative energy. His choice was an outstanding one, and we decided we needed to have the book. Brand new it was $30, but we got it on Amazon for $8, including shipping. We use the book all the time, but the fact is most books are read then either shelved or discarded. So why buy them brand new?
Check Amazon.com before buying any book brand new. Chances are they have several used copies for a fraction of the price. If you?re a book hound, get familiar with the used book stores in your area and frequent them regularly.
8. Secondary appliances
In order to stretch the food budget, many people have or want to have secondary appliances, like a freezer or a second refrigerator. But if you already have a refrigerator, why pay the retail price for a second unit that?s hidden in the basement and used mostly for extra storage? Somewhere in your community, someone is looking to sell an appliance, and you can probably get a few years use out of it for just a fraction of the price brand new.
We don?t buy too many DVDs in our home these days because we began to notice a pattern that when ever we purchased a must-have DVD, we?d watch it two or three times, then store it in the cabinet with the 100 other DVDs we don?t watch any more. That?s a lot of money sitting in a cabinet gathering dust! Cheaper, used DVDs are the only sane way to buy a movie that you?ll probably only watch a few times in your life.
10. Video games
This is really an extension of the discussion above on toys?but for older kids. Like toys, video games are just phases that pass, so the less you spend on them, the better.
We?ve gotten some decent discounts buying used videos through EB Gamestop, finding that the quality is generally comparable to brand new ones. The one or two that did degrade to the point of impairment turned out to be a non-problem because the kids just moved on to another ?hot? game. Like DVDs, video games just aren?t worth a heavy investment.
A disadvantage of buying used goods is that you may not get exactly the items you want, but that will be a small price to pay for the extra thousands of dollars that you won?t spend or borrow, that can be used to improve other areas of your life?like your finances!
Can you think of any other items that are better bought used than new?
Excellent list! Just thinking about how easily kids grow out of toys, clothes, and interests, it makes a lot of sense to buy most of their items used.
I didn’t know about buying auto parts online. Thanks for the tip!
Khaleef – Definately check out the post on buying used car parts. Not only will you save a ton of money, but you’ll also come to realize how much you’re REALLY paying for your car repairs!
Not only are we being charged for labor, but there’s also a substantial mark up on the parts the repair shops are using, whether the parts are new or used.
Some Electronics – not all, but some.
My TiVos are all second hand. They came with lifetime service (service is $10/mo or $400 lifetime) and are saving me $25/mo compared to the cable company. I am technically savvy enough to image a new drive should one fail (this is actually the common failure mode for these machines as they run 24/7) but in the end, I am way ahead.
Stereos – remember tuners/amps, actual speakers? The one I bought 15 years ago for $400 on closeout now sells for $50 on eBay. Same remote, I know the features, bought one for basement and one to replace my 30 year old tuner that died in bedroom.
Computer – At the risk of being called a fan-boy, the G4 MDD Mac is by far the sweet spot in functionality. 7 years old, these were $2500 new, now $250 tops on eBay. Dual 1.25GHz processors, they are a great machine and until two weeks back, my primary Mac. They make a great computer for those who just need email, websurfing, etc. One of them replaced a Vista PC that simply didn’t want to work. (The PC now runs Linux and images TiVo drives)
Joe – that’s a lot of great information. I’d never given much thought to buying second hand computers (peripherals yes), but while reading your comments it hit me that a second hand computer would be the way to go for kids.
They don’t usually have the reverence for gadgets that we do, so it might be better to get them one you won’t be too concerned about were it to get lost, broken or abused. At a minimum, it would be perfect as a first computer for them, so they have a chance to cut their teeth on it.
I love buying used. While I don’t buy video games (new or used), every other item you listed is something I hardly ever buy new. I checked on used computers last time I upgraded and found that the newer ones got me more for my money…more RAM, hard drive, etc for little more than I could find on Ebay or Craigs list.
Joe – That’s why in the above comment I only agreed it would be good to buy a used computer for kids. With computers, what we’re buying is the latest technology, and we’ll probably sacrifice that if we buy one that’s a few years old.
But if you only need a computer for emails and general surfing, used can work. It’s when you get beyond that that used can present limits.
It’s an interesting debate though…are you better off buying an inexpensive new computer, or a good quality one that’s only a couple of years old?
I’m not computer savvy enough to address that intelligently.
Just as long as you don’t buy food used.
David – There are some posts on the blogosphere about that too, but I digress!
I think I have purchased all of the items you listed used at one point or another in my life. And I second JoeTaxpayer in that computers can be a good secondhand buy, especially if you are into taking them apart and tinkering around with them.
Hi Brian – Agreed, but first order of business would be to replace the harddrive. You never know what the previous owner downloaded, and you don’t want to be responsible for it.
I forget when I wrote my comment above. I’ve gotten a Dell Laptop, model D630, this was a common model employed in large companies on lease, and now sold as refurbs running Windows 7.
These run Linux beautifully. Ubuntu to be specific. I’ve been running this laptop with Ubuntu for over 6 months, never a crash, freeze or blue screen. It offers automatic updates with a click as simply as the Apple Update, and no where near as complicated as the Microsoft service packs.
Linux today, is not the Linux of ten years ago. It’s now a community supported OS that requires zero tinkering. These sell for about $200 from many sources, and make a great laptop purchase. (See, I’m not the Mac fanboy, I sometimes appeared to be)
Hi Joe – I’m familiar with Linux. They have no security issues because all the hackers and spammers are keyed into Microsoft. We used Linux on an old, infected computer, and it worked like brand new. I wrote an article on the experience on this site.
A house. I don’t think they make them as good structurally as they used to, so better renovate than build new.
Hi Pauline – I agree with you with a house. Not only do you pay a premium for them (new, first time owner, “MY house”, etc), but they often come without a lot of little amenities, like window treatments, kitchen cabinet hardware and landscaping that we take for granted but the builder may not have. You can add them to the purchase price, but that will make the price go a good bit higher. Also, you’re more likely to find a distress sale situation with an existing home where you can buy at a serious discount. I know a number of people who said “never again” after buying a brand new home.
Nice list Kevin! I think we have bought almost all of the things listed, at some point, used. Since we still have little ones, buying used is huge as they can outgrow things so quickly. We sell a lot of what they do not use anymore and just put that towards buying “new” to us stuff as they need it.
Hi John – That’s so true with kids, especially with clothing and toys. You can spend a lot of money on them, but they grow out of them so quickly. DVD and video games too.
Brilliant list. As a pre-loved item purchase fanatic I found myself nodding along in agreement. I just don’t understand why anyone in their right mind would buy a brand new car off the lot – you lose so much money when you turn the key for the first time.
Hi Yuen – I’m with you. I see no point in buying brand new if I can avoid it. In fact, I no longer panic when something breaks. I just head out to a garage sale or thrift shop to replace it. When you can buy something for five or ten cents on the dollar, why buy brand new?
Side note on cars: we just brought our 15 year old van in for repairs. One of the managers there told us that they have commercial vans coming in with – get this – 1 million+ miles on them! The owners just keep fixing them. They figure $1500 per year in repairs is a lot less expensive than replacing them.
Great list! I bought a DVD player refurbrished recently and it works great for half the price. Buying factory refurbrished is sometimes even better because they factory goes through another inspection to see that the product is in good working order.
Hi Andrew – I hadn’t thought about buying refurbished from a dealer, but it sounds like a good idea.
I loooove buying new furniture! I can’t wait to get back to the States and shop at some thrift stores! So fun!
Used furniture is fine, as long as it isn’t upholstered. The hygiene issues alone (BEDBUGS!) would keep me away. You couldn’t pay me to take a used mattress, for example.
Hi Jeremy – I agree on the mattress issue, that’s one thing I won’t buy used. A box spring sure, but not a mattress. With other upholstered furniture, I’d take it on a one on one basis. If the furniture is in good condition and it doen’t smell (very important!) I’d go with it. Of course, it would be shampooed as soon as we get it homme. We’ve had good luck with these in the past. But no doubt about it, non-upholstered is definately a much easier buy.
Please, could you put me on your mailing list. I enjoy your articles. They are very useful.