Great Savings 15: Rent, Borrow or Buy Used

 

Should I buy my car new or used?

In our original Great Savings Tip 15 we limited the discussion to buying used tools. Today, we’ll consider why it’s a good idea to try not buying at all, to buy less or to buy for less when it comes to all your household purchases. Hey, you can save thousands!

 

There’s no question owning a brand new tool or couch or whatever tickles your fancy can be nice. Yet as we get older (which happens much faster than we expect it should), we soon discover we own an endless variety of items we don’t really need or use. Somehow, that particular thing that seemed so important to own when we saw it in the store loses some of its luster the minute we take it home.

 

Do you always by new? Is it worth it?The simple act of desiring an object increases its value in our minds. If you’ve ever held a garage sale you know this is true. After all, aren’t you willing to give up old items you bought at full price for practically nothing at your sale? And aren’t the people looking at them willing to pay you more today than you would? There’s an old saying: “Value is in the eye of the beholder.” Maybe there’s a corollary here: Something like, “As the eye is a restless beast, value is fleeting.”

 

As I look around my house, I find I’ve collected far too many things over the course of my life. I know this to be true for practically every day I walk past most of them without giving them a glance. Some sit openly on shelves waiting patiently for my attention. Some are stored away in boxes for the day I might need them. Others are stacked neatly in cupboards, hoping to be rediscovered. And time plays a role here, too, for over the years many things I once found interesting or useful are no longer relevant or meaningful.

 

 

What we’re suggesting is not to stop buying at all, but to carefully consider whether the desire for something we don’t own now is real. In other words, it’s worth asking if the thing we want so bad in the moment will be held in the same high esteem tomorrow—after we bring it home.

 

Not buying an object doesn’t mean we can’t hold it in our possession for a time. We have options.

 

Tools are far to easy to collect.

It’s rare I need a generator, so this is one case where renting could make sense.

Let’s take the example of tools: As one who regularly uses a few hand tools for the minor repair, I know it’s worth having a basic set of them around. Yet I’ve somehow managed to collect a large number of tools that only get used occasionally. In fact, some don’t get used at all. So why do I keep them? I suppose it’s because I still see value in their potential use. Over the years, I’ve done many a home project where having the right tool has been a real convenience for completing the work.

 

Still, I don’t need to own every tool and there’s a tool rental shop less than a mile from my house. This means I have options. I could rent certain tools rather than own them. Or as we have endless garage sales in the area I live, I could find tools at a fraction of their original cost if I really need to buy something I don’t already own. I also have a number of friends who own tools so I could probably borrow certain tools in a pinch. Bottom line: I have options that could save me money.

 

Buy clothes for pennies on the dollar.

Shoes and clothing are another area where buying slightly used can make a lot of sense.

Ultimately, each of us has to decide whether the object we desire in the moment is important enough to own. That makes it a personal decision. Yet as we’ve been learning in this series, any decision to spend regularly can add up over a lifetime. It’s rare we’ll look at a pair of shoes, for example, and think of the big picture. The shoes are cute or comfortable. Maybe there’s a sale on so we buy them at $30 off. We think, “What a great deal!” Then we bring them home, look in the closet and see we already own a dozen or more pair of shoes that still have a lot of good use left in them.

 

Suddenly, the shoes we just purchased are not as important as they seemed at the moment we purchased them. And doing the math we see that if we buy a pair of $50 shoes every other month that’s ($50 x 6 =) $300 a year or $3000 for ten years, $6000 for twenty years, $9000 for thirty years and so on. Do we stop to consider such high sums as we cling to the feeling we must own those shoes? Probably not. Will impulse purchases like this impact our savings or retirement? They could. At least, it’s worth thinking about.

 

When We Really Want It What Are Our Options?

 

When we really need or want a particular item, and we want the best deal, what are our options?

 

Should I buy or rent?

It may not make sense to buy a house when an apartment will do, especially if you are only going to be in the area a few years.

(1) We could buy used. For example, we might: (A) Find the item on websites like eBay or Craigslist. (B) We might also consider buying the item refurbished. This can save hundreds on products like laptops or smart phones.

 

(2) We could buy new at a substantial discount. How? (A) Scour the internet for coupons or check sites like Groupon. (B) We could also check hot buy websites to see who’s currently got the best deal.

 

(3) We might rent the item. That may not pay if we see using the item long term, but if we only need it for a short time or particular job it can really save big time. A note of caution: When renting, do the math. First, try to figure out how long you’ll need to rent and then calculate the total cost. It’s not always the best deal, but under certain circumstances it makes great sense and you won’t end up shelling out a big chunk of cash up front.

 

Save money buying books.

Why pay for new cookbooks? You can find them by the dozen at garage sales for twenty-five to fifty cents. Or get them free at the library.

(4) We could borrow the item. This only works if we know someone who wouldn’t mind sharing. Plus, borrowing certain items like tools, kitchen gadgets or expensive clothing is easier when we know we’ll only need to use them for a short period of time.

 

(5) We could barter for an item. Got things you don’t need or a talent you can trade? It could come in handy when you’re in the market to buy. For more on this topic see our Great Savings Tip 9: Swap Goods, Time and Talent.

 

Action Item

 

Think of an item you’ve recently purchased—something you really wanted before you got it. Now, ask yourself if it still has the same value as it did before you bought it. If it does, great! If not, check whether you can find the same item now at a lower cost and ask yourself whether under the circumstances you wish you’d waited. Again, it’s a personal choice to buy or not and only you can say if it was really worth it.

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