By Kevin M

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?

1. Furniture

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.

2. Cars

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.

4. Toys

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.

5. Clothing

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.

6. Tools

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.

7. Books

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.

9. DVDs

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?

By Kevin M

The cost of living has been rising relentlessly for decades, and while we tend to notice it less during the good times, it all hits home hard in times like these. Forget the official numbers that deny the existence of inflation, if you’re middle class, working class, a struggling business owner, and especially if you’re retired, you know the real story from the trenches on the front lines.

Sure food costs have been bouncing up and down in a range, and gas prices are about 40% lower than they were a year ago at this time, but what about everything else? What about property taxes, utilities, health insurance and all things education related? What about movie tickets, theme parks, medical co-pays and car repairs? Our auto insurance just increased by more than 20% because of state mandated add-ons to cover uninsured motorists. 20%–in 2009—how’s that for timing?

With incomes flat and jobs disappearing, the logical course is to trim or eliminate expenses across the board. Some expenses are easier to reduce than others, but the best strategies overall tend to involve cost cutting on numerous fronts. Here are a couple of the things we’re doing in my house.

Using a wireless router to add an additional internet line. This one is recommended for home or office computers, and can save substantial money if you need additional computer lines but can’t afford the higher monthly cost.

We had one internet connection, but we have two teenagers, and you know what that means. Facebook, computer games, Facebook, email, Facebook, school research projects, and more Facebook. A new internet line would have cost over $200 to install, plus a monthly fee in excess of $45—that wasn’t happening!

On recommendation by several techie friends, we bought a Linksys Wireless-G Broadband Router at Best Buy for $50. The device attaches to your main computer, then to a second computer by cable, giving the second computer full internet access. Though I don’t completely understand how it works, the second computer has different email accounts and a separate identify from the first, with no decrease in service to either unit—a certified miracle of modern technology!

There is NO monthly fee for this arrangement, and it’s totally legitimate with your ISP.

It’s somewhat more complicated to install than the unit instructions tell you it will be; think along the lines of “some assembly required” and how simple that never really seems to be. But once installed, you’ll have two fully functioning internet connections for the price of one.

Buying our clothes at thrift stores. We’re not recreational shoppers when it comes to buying clothing, but in a family of four somebody always needs something for some event somewhere, especially at this time of the year when the start of the upcoming school year is fast approaching. Even with store sales and statewide sales tax holidays, buying a “few pairs of pants, a few shirts, and a couple of pairs of shoes” can easily cost hundreds of dollars. But there is a way to cut this cost considerably.

We’ve become regular thrift store shoppers (See A Thriftier Way to Dress). You can buy gently used clothing, most of it for under $5 per article. A brand name shirt, in near new condition, that might cost $50 in a mall store, can be purchased at a thrift store for $3 (that’s not a misprint!). From time to time, you will come across items that are brand new, labels attached, for similar prices.

Unlike the power charged trips to the mall, you don’t go out to thrift stores with the idea of replacing your wardrobe, as it is a hit or miss venture. We like to go once or twice a month, covering several stores (Goodwill Stores is highly recommended), browsing for items we like and that fit. Price is never an issue! If you buy a few articles on each trip over the course of the year, you won’t need to fight with the herd at the mall at peak shopping seasons. Not only will you save money on the clothing itself, but the concept of buying in small doses over the course of the year is much easier on your budget, especially if you have children.

What are some changes you’ve made or plans you’ve implemented to lower living or business expenses? What expenses have you been able to reduce? Are there any you’ve been able to eliminate entirely? Big ideas, small ideas, they’re all worth exploring.

By Kevin M

If you’re serious about reining in your household expenses, shopping in thrift stores is an option that needs to be investigated. Thrift stores offer an opportunity to buy clothing for pennies on the dollar compared with the cost of retail. Shirts $2, pants $4, typical! If you work in a business where mode of dress is a major issue, or you have a family who seem to burn through clothes with each turn of the seasons, saving money on clothing could be a major boost for your budget, and thrift stores are the perfect place to do it.

The Basic Setup

If you’re new to thrift stores and accustomed to the shopping experience provided by mall stores and prime retailers, they can be a bit of shock. Usually they’re set in shopping centers that are best described as less than prime, and the stores tend to have something of a bare bones look. This is of course as it needs to be; in order to offer the lowest prices, thrift stores cannot operate in triple A space. But if you can get past the store’s appearance there are true bargains to be had.

Thrift stores are dominated by clothing, but usually have sundry items in the back or corners that can include books, decorative pieces, furniture, and entertainment equipment. Though the arrangements can look a bit haphazard there is an order to it. Racks of clothing are separated by personal status (men, women, girls, boys, toddlers, etc) and, within each section, are arranged by type (pants, shirts, coats, etc). They are segregated by color, not by size as is typically the case with traditional retailers.

If you’re looking for prices, that hand written numeric scribble you see on the tags IS the price. Oh, and they do have fitting rooms.

Significant Benefits

The most obvious advantage is that you can purchase clothing at a much lower cost than at traditional retailers saving potentially thousands of dollars each year. The reason thrift stores can do this is because the merchandise is donated. Charity run thrift stores, such as Goodwill, collect donated clothing from the public, sell it in their stores and use the proceeds for charitable purposes. But as there are many charitable organizations collecting clothing these days, many raise funds simply by selling the merchandise to private thrift stores, eliminating the need to maintain a sales organization.

Thrift stores offer an especially generous advantage in regard to children’s clothing. Kids need clothing more frequently than adults either because they grow out of what they have, wear it out faster or tend to be more fashion conscious. Volume is a major driver in buying clothing for kids. Fortunately, the same factors affect most families with kids, with many people putting the clothes out for charity collection when they’re no longer needed. As a result, much of the children’s clothing in thrift stores is quite obviously barely worn. If your children are young and growing out of their clothing in a matter of only weeks or months, you will save quite a bit buying second hand versus new.

The vast majority of articles for sale are second hand, but most would fit under the classification of gently used. However, you can find some items that are brand new. My wife recently was able to purchase a pair of Liz Claiborne pants for under $5 and they were new–even the retail tags were still attached. Brand new the same article would have been well over $50.

Many items offered are brand name. Geography may play a part here; since merchandise is largely culled from local donations and clothing drives, there does seem to be a greater volume of brand name merchandise offered by thrift stores located in higher end areas, so even if you live in a more middle/lower middle class environment it may be well worth the time and gas to take a drive to stores located in the higher rent districts.

Finally, though most patrons probably don’t think about this, there are environmental benefits to shopping in thrift stores. Any new item you purchase requires natural resources to produce; by buying second hand you are, in effect, buying recycled goods. While many people participate in recycling projects in the disposal of goods, it is an equally significant contribution to be an end user of recycled products. Any product which is re-used reduces the demand for natural resources.

Some Things You May Need To Be Aware Of

Thrift stores are very much hit or miss. Most items are one of a kind. If you find the perfect shirt, blouse or pair of pants, but it isn’t in your size, you will have to look for something similar. It will be difficult to set your heart on buying a specific outfit in a thrift store since there is an overwhelming chance that either it won’t be in stock or it won’t be in your size. As such, it’s probably best to arrange your shopping trips as periodic rather than item specific, and plan on accumulating clothing on a continuous basis.

Put together a list of several thrift stores, and plan on making the rounds once or twice a month, or what ever your schedule permits. Go through all of the merchandise in your section of each store to find items that appeal to you. Go ahead and buy what you find, the prices are so low you won’t regret it later. Shopping in this way will also cut down on the cost and stress involved in large shopping sprees like back to school.

You need to be aware that thrift stores typically have a no refund policy, and since most items are second hand, you must be sure to check all articles thoroughly before paying.

Despite the obvious advantages of shopping in thrift stores, there are certain items I can’t conceive of buying second hand. Underwear is one, shoes are another, but you could probably come up with your own list. Moral of the story: don’t plan on severing your ties to mainstream retailers completely.

Saving money always makes me feel good, but if shopping represents a form of entertainment, and you genuinely enjoy the shopping “experience” you get at the mall, thrift stores can leave you a bit empty. Traditional retail stores focus not only on product selection, but also on ambiance. Product arrangement, store colors, customer service, music and even aroma’s are established to create an environment that just makes you feel good. So do as much shopping in thrift stores as you can–saving a ton of money in the process–then head over to the mall and enjoy the ambiance, and all the more since you won’t be paying for it.