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Reader Question – Buy Me Now or Buy Me Later?
I was recently presented with this question from one of my readers:
Thought you might be interested in weighing in on the decision we are needing to make. We are nearly entirely on a fixed income now, so there is no cash from the working budget for any large purchase. Our clothes washer is at least 13 years old and has been making strange noises for some time. The repair man said not to put any more money into it if breaks down again. So here is the decision: do we gamble and wait for the thing to die and then possibly have to pay a larger amount (from savings) for a new one OR do we take the money (again from savings) and purchase a new one now, hopefully on sale and while we can get a little Energy Star appliance “clunker” rebate from the government? Which move is more financially prudent?
I think the key here is to not have to put the purchase on a credit card and pay a high interest rate on it thus making a difficult purchase even more so. In either case you describe, you are using your own money to purchase the washer. If you were saving up to be able to buy one later but had to use a credit card to buy one now, I would say wait and save. That is not the case for you.
Let’s look at the details a bit more. We’ve already established that you are using money from your savings. The question is should you wait or do it now. The advantages of buying now are that you can be proactive about finding a sale and use the appliance clunker rebate (of course, each state handles this differently). Another advantage of waiting would be to earn interest on the money in your savings account while it sits there. That is not going to amount to a significant amount of money even if you do get another year or two out of your washer. At $1000 with current rates maybe at 1%, that’s $10 a year – not very much. As long as we’re talking small sums of money, don’t forget to consider how much more energy efficient a new washer would be compared to one that is 13 years old. A new one will most likely save you some energy costs and the sooner you purchase one the sooner you’ll start realizing those savings.
On the flip-side, the pros for waiting are that your washer could in fact continue to work for a long time thus saving you that cash outlay for months or possibly years. I guess that’s all I can come up with as a pro for waiting (I’d have a better argument for waiting if you told me you were going to charge it and pay it off over the next 24 months!)
Again, I think the overarching key to this question is whether you can make the purchase now with your own money or if you have to use a credit card. If I were in your position with money in the bank to purchase a new washer, I would start looking for one. Do your research for price, effectiveness, and reliability, check out different stores, search for coupons and sales, etc. Basically, I’m suggesting that you prepare yourself ahead of time so you can take your time but still be ready to pounce when you find a great deal. Good luck!
I’d love to hear if any readers would like to chime in with some (possibly different) advice…
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4 Responses to “Reader Question – Buy Me Now or Buy Me Later?”
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My suggestion…
I would hold on to the money you have now and let the washer keep working as long as it can. During this time be shopping around. I have seen many of free or cheap washers on Craigslist that last people awhile. The washer in my house we bought used for $30 and after 6 years it is still working and if it quits tomorrow I will shop for another cheap washer.
I do not think spending the money on the brand new washers is going to be beneficial. Think of it this way. You already have a good idea of what it costs to get these things repaired. If you can find one that lasts for a year for less than $100 and then it breaks at any point, I would just throw it out and find another one in the same price range. I do this with lawnmowers, washers, dryers, washing machines and anything else I can get for under $100 and the repairs usually cost over $30+.
I will also note that this is where we turn to our trust in God. We pray about our purchase, we work through him to make the best stewardship decision possible. I can’t believe the money I have saved by taking time to pray and shop around as compared to my past when I would go out and follow this worlds traits and buy new and filled with features.
The only feature I need is for it to clean my clothes.
@Jason – that sounds like an intriguing idea. It seems like a bit of work to have to turn over your equipment periodically (and I’m sure some people just would not want to deal with it) but I bet most of the time you save a ton of money. Sounds like you really did well with your last washing machine. I’m going to have to try this next time I need something like what you mentioned. Thanks for the suggestion.
I’d be tempted to buy as soon as you see a good sale price, especially as you have been warned that the washer is on it’s last legs!
I would say be patient and keep an eye out for really special bargains and hot deals on a new washer – you don’t need to buy one right away so you have some time on your side to look for a good deal – many stores will often have time limited offers on selected models and those are the best times to save some money.