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Old 01-18-2011, 09:32 AM   #41
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Good point on the cars. The last three I've bought were one owner cars only 1 or 2 years old and with less than 15k miles on them. Bought them from the original owners and not car dealers. Amazing how many great deals are out there if you're willing to take the time to shop the used car market.
Maybe -- if one is willing to do a lot of legwork and be very patient.

But for the most part, the "buy 1-2 year old cars and save BIG" strategy became a victim of its own success and isn't nearly as true as it used to be. Before there was a high demand for these 1-2 year old cars, the depreciation curve looked more like the graph of y = 1/x -- a rapid, steep decline early in the lifespan of the vehicle, and buying at the "elbow" of the curve where it starts to flatten out was a good strategy.

These days -- particularly for Hondas and Toyotas but to some degree for all cars -- the curve is flatter and closer to linear; the days of losing 30% of value the moment you drive it off the lot are mostly gone. Sure, some great "almost new" deals are still out there, but this one really worked better 10+ years ago than it does today (at least as reflected in typical market prices). And *sometimes*, particularly during aggressive sales campaigns by the automakers, buying new is arguably a better deal given the full warranty, discounted price and not wondering what the previous owner did to the vehicle. A $3000 cash back offer on a $25,000 new vehicle may be a better deal than the same vehicle for $19,000 and 20,000 miles on it.
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Old 01-18-2011, 10:22 AM   #42
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Maybe -- if one is willing to do a lot of legwork and be very patient.

But for the most part, the "buy 1-2 year old cars and save BIG" strategy became a victim of its own success and isn't nearly as true as it used to be. Before there was a high demand for these 1-2 year old cars, the depreciation curve looked more like the graph of y = 1/x -- a rapid, steep decline early in the lifespan of the vehicle, and buying at the "elbow" of the curve where it starts to flatten out was a good strategy.

These days -- particularly for Hondas and Toyotas but to some degree for all cars -- the curve is flatter and closer to linear; the days of losing 30% of value the moment you drive it off the lot are mostly gone. Sure, some great "almost new" deals are still out there, but this one really worked better 10+ years ago than it does today (at least as reflected in typical market prices). And *sometimes*, particularly during aggressive sales campaigns by the automakers, buying new is arguably a better deal given the full warranty, discounted price and not wondering what the previous owner did to the vehicle. A $3000 cash back offer on a $25,000 new vehicle may be a better deal than the same vehicle for $19,000 and 20,000 miles on it.

Funny you mention this... my sister just bought a new car and her take was that it is even a bit worse than linear... think of the line going down, but with a curve bump there...

She used to buy 5 to 7 yo cars and pay cash... her take is that now people are expecting cars to go 150K or so and if they have 75K miles, they want more than 50% of the original value...

I have bought new most of the times because you never know what has happened to the car... it could have been in a flood even if it was a few days old... I just think the new and the warranty is worth the extra money... considering I keep them 10 to 15 years...
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Old 01-18-2011, 10:36 AM   #43
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Originally Posted by BTravlin View Post
Good point on the cars. The last three I've bought were one owner cars only 1 or 2 years old and with less than 15k miles on them. Bought them from the original owners and not car dealers. Amazing how many great deals are out there if you're willing to take the time to shop the used car market.
+1.

I really like paying 3 to 5K for cars that sold for 40 to 60K originally.
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Old 01-18-2011, 11:00 AM   #44
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I experienced much the same buying a Prius 3 years ago. There was little to know "discount" in buying a newer used vehicle with low mileage.

On other items --

Paying for quality items just depends. In general, I've never really gotten into higher quality furniture. I did make an exception once about 20 years and bought an extremely expensive sofa and chair with purple suede leather. The leather has long since faded and is worn and looks awful but the sofa and chair are both still in great shape very comfortable. I'm constantly conflicted by it. I don't like how it looks but they are in great shape and comfortable but for appearance. I could recover them but the costs basically equals what it would cost me to buy a new sofa and couch (albeit not of the same quality). I feel guilty just throwing them out. So I feel stuck with them.

For me, what I pay for is very feature dependent and whether I use that feature. I recently bought a new toaster and elected to buy cheap. I am constantly annoyed as it doesn't have the features that I've gotten used to having. Of course, it is important not to pay for features that aren't important to you.

We did spend for a high quality Miele vacuum cleaner that is HEPA filtered (I have a lot of allergies). It was one of the higher quality ones but I didn't pay for the highest priced one as it had features that were of no importance to us.

I do tend to use my computers in a way that puts a lot of demands on them so I tend to spend more there, particularly to get dedicated video memory. Again, this is not something that matters for everyone depending on their use.
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Old 01-18-2011, 11:23 AM   #45
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I'm firmly in the camp that spends more for higher quality when it matters - personal comfort or things that will be needed to last for a long time. Our bedroom furniture was a stretch for us 35 years ago, but we still have it and it will pretty much last forever. Style is way outdated, but we will only get rid of it when we downsize (it's also a pretty huge and heavy set). Beds are extremely important - we pay more for what makes our backs feel good. Never kept one for more than 15 years - they all get saggy by that point. I always buy clothes on sale at outlets - meaning, I'm jusy as happy in jeans and a field jacket as someone else would be in a Brooks Brothers suit - DW says I'm still stuck in '60s college clothes. But I did get rid of my Nehru jacket and leisure suits .

Computers are replaced every 7 to 8 years as they become so out of date they won't run the latest software, but we go with medium priced models. Printers and other peripherals are bought on sale at the low end - they don't last a long time anyway. We had several nice analog CRT TVs in the 12 to 20 year range, but have replaced just about all of them with Costco HDTVs. It's really hard to mount a Sony 37" flat screen CRT weighing 200 lbs on the wall . I'm just glad we found someone on Freecycle to take it rather than pay to have it hauled away.

Still have and use our Sansui AM/FM receiver/amp we bought 38 years ago. Solidly built and will only get rid of when they stop broadcasting on AM/FM . Even the best speakers will dry rot after many years, so we don't get top of the line.

I know others may not agree, but I don't think buying known poor quality is ever worthwhile.
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Old 01-18-2011, 12:27 PM   #46
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I don't care what it is for the home, I buy the highest quality I can find for the lowest price. I comparison shop like crazy and use amazon.com, overstock.com, homedecorators.com, etsy.com for art and even ebay.com, plus, check the newspaper for sales in my local area.

If you are talking about LBYM, it doesn't pay to purchase poor quality--even at dirt cheap prices--cause they don't last and you will have to replace them. Buy high quality and watch for sales and comparison shop seems more intelligent to me.

And, yeah, it takes some work but you save in the long run buying high quality for low prices.
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Old 01-18-2011, 12:30 PM   #47
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If you are talking about LBYM, it doesn't pay to purchase poor quality--even at dirt cheap prices--cause they don't last and you will have to replace them.
Not always. A bottle of Jack can cover for a couple of bottles of Old Granddad. The first couple of shots are quality, then switch to the cheap stuff after the tasete buds have passed out.
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Old 01-18-2011, 12:36 PM   #48
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Buy what your want!!!

I have bought cheap, and I have bought quality. Nine times out of ten when I buy cheap I end up buying what I really wanted in the long run. If cheap makes you happy buy cheap. If it doesn't don't do it.

If you have your savings accounts set up and you are making your goals, the enjoy life. As has been said before here, FIRE may be a goal, but you should not make yourself miserable getting there.

Also define the difference between hobby and household. For me, electronics is a hobby. I spend more than most on it. But, hey, it is what makes me happy.
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Old 01-19-2011, 08:14 PM   #49
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Maybe -- if one is willing to do a lot of legwork and be very patient.

But for the most part, the "buy 1-2 year old cars and save BIG" strategy became a victim of its own success and isn't nearly as true as it used to be. Before there was a high demand for these 1-2 year old cars, the depreciation curve looked more like the graph of y = 1/x -- a rapid, steep decline early in the lifespan of the vehicle, and buying at the "elbow" of the curve where it starts to flatten out was a good strategy.

These days -- particularly for Hondas and Toyotas but to some degree for all cars -- the curve is flatter and closer to linear; the days of losing 30% of value the moment you drive it off the lot are mostly gone. Sure, some great "almost new" deals are still out there, but this one really worked better 10+ years ago than it does today (at least as reflected in typical market prices). And *sometimes*, particularly during aggressive sales campaigns by the automakers, buying new is arguably a better deal given the full warranty, discounted price and not wondering what the previous owner did to the vehicle. A $3000 cash back offer on a $25,000 new vehicle may be a better deal than the same vehicle for $19,000 and 20,000 miles on it.
It has certainly gotten much tougher in the last couple of years as far as used cars holding their resale value but on the other hand there's been a big increase in the number of people in trouble who need to sell in a hurry. I've had phenomenal success buying in southwestern Ohio mainly from 30 something couples who overextended themselves.
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