The decision to buy a new item versus a used one is a common dilemma for many people. While the saying “new is always better than used” is often repeated, it should never be the ultimate rule. Not only can buying used save significant amounts of money, but it can also have positive environmental effects.
The number one reason to buy used is the cost savings you can use. Whether purchasing furniture or a car, buying used can keep your hard-earned money in your bank account. Used items are typically sold at much lower prices than new items. This means you can save significant money by buying used items, which can be especially important if you’re on a tight budget.
Car Savings
If you’ve bought a car in the past, you’ve likely heard of the term depreciation, as cars typically lose their value quickly. When you buy a new item, it begins to lose value as soon as you take it out of the store. This means that if you were to sell the item a few months later, you would only be able to get a fraction of what you paid for it. When you buy used, the initial depreciation has already taken place.
Buying new can involve risks, especially for expensive items such as cars. It’s said that cars experience a 20% drop in value in the first year due to depreciation. To illustrate this, let’s assume you buy a car for $40,000 without putting any money down. By the end of the first year, your car would be worth around $32,000; however, you would likely still owe more than $35,000 on the car, resulting in you owing more than it’s worth. While this is fine if you plan to keep the car for some time, if you don’t like it and try to sell it, you won’t be able to get what you even owe the bank. Conversely, by buying a slightly used car, you can potentially mitigate some of that risk by avoiding incurring that initial depreciation loss yourself.
Washable Items
When deciding whether to buy used, it’s essential to consider whether the item can be sufficiently cleaned or repaired. Many washing machines today have a sanitizing cycle, making buying used clothing easier and cleaning it so you’re comfortable wearing it. Additionally, most children’s toys can be cleaned with a Clorox wipe, so you can feel good knowing they’re sanitized. Regarding toys, it’s all too common for them to be used for a short duration with very little wear and tear. This allows you to buy a like-new toy for a reduced cost.
Environmental Benefits
Lastly, buying used can have long-lasting environmental benefits. Buying used means saving the item from ending up in a landfill and giving it a new life. This can help reduce the amount of waste generated and can help conserve natural resources. Additionally, buying used items can help reduce the demand for new products, which can help reduce the environmental impact of manufacturing and transportation.
Buying used can save the average person significant money over time if they shop wisely. There will still be times when you’ll prefer to buy new, such as when you’re expecting your first child, and that’s perfectly fine. Just remember that not everything needs to be new. Finding a balance between buying new and used is crucial in purchasing items while still leaving money in your pocket. By buying used, you can save money, avoid rapid depreciation, reduce financial risk, and help the environment. On other tips to reach your financial goals, be sure to check out our budgeting article.