Preemptive purchases: Wasteful or worth it?
Today is the tomorrow we worried about yesterday.
~ Author Unknown
Have you ever replaced an item before it really stopped working? Recently, we bought a new washer and dryer. Our old ones were working fine, but they were over 10 years old, and we began to worry about sudden service interruption. We do a lot more laundry at our house than we used to. Here’s a tip for those of you with really young children out there: their clothes get bigger too! This means it takes a lot fewer pairs of jeans to fill the washer.
Mr. Cents did a lot of research online and decided that the most likely future problem would be that a bearing might go on the washer. It would not be worth it to pay to have it fixed. So we did some more research and decided on a few new models (bigger ones) that we liked. We debated whether or not the purchase was justified, or whether it would just be nice to have a new (and bigger) washer and dryer. Recently, MapleMoney had a post on How to Make Your Appliances Last Longer that might be helpful to you if you’re trying to squeeze a little more life out of yours.
In the end, we bought a new washer and dryer a few days after the New Year, as a local appliance store had a good deal on a nice set. They had lots of inventory and free delivery. Sometimes seasonality can affect how much we pay for things. A guest post by April Dykman on Get Rich Slowly recently highlighted The Best Time to Buy Almost Everything.
We ended up paying just a bit more than we had paid 10 years ago for our existing set, we got a larger capacity set, and we sold our current set on Kijiji for $175. We used our PC Mastercard to pay for it, so we’ll also get about $15 toward groceries as well. I’m glad we did it, and Mr. Cents is happy to have avoided a hysterical phone call from me in the future when our washer would eventually have conked out.
Just before Christmas, our coffee maker started acting up, so we bought a new one when we saw it on sale for 40% off – another preemptive purchase. We didn’t want to be without coffee for ourselves or our guests around the holidays. We actually gave up on the old one last week and got out of the new one. One thing to think about in a case like this is how it might affect your warranty situation. Your warranty will be effective from the date on your receipt, not the date you plug it in.
So how do you decide whether a preemptive purchase is wasteful or worth it? Well, it may depend on the following factors:
1. Your financial situation
If you have a lot of consumer debt already, it makes more sense to try to save up in advance for the purchase in order to avoid taking on more debt. If you absolutely need it, maybe you could try to get something much cheaper on a site like Kijiji to tide you over until you can afford what you need. If you have enough money to pay for the item without debt and your budget won’t be severely impacted, go for it. Get the best value you can for your dollars.
2. The item you are replacing
a. Big-ticket or small potatoes?
If you’re looking at a large purchase like a vehicle or major appliance, you need to be a lot more careful about your decision. It makes more sense to wait if you haven’t saved enough. If it’s a smaller item, it will have less effect on your finances. But if you really don’t need it, it still doesn’t make sense to spend the cash. If you’re going to replace something large, but you have done your research, you feel like the peace of mind it will give you is worth the price, and you can afford it, then go ahead.
b. Staple or extra?
If this item is an extra that you really could do without for a while and you can’t afford it, it’s not worth stressing yourself and your balance sheet to buy it now. If it’s an essential item but you are not ready to buy it without taking on debt, you may want to wait. If you must take on debt for a staple item, get the best interest rate and terms you can and adjust your budget to pay it off as soon as possible. As long as you can afford it, you can spend on staples or extras. Just make sure you don’t end up buying a model that is more than you need for more than you wanted to spend.
3. Your motivation
If you are replacing an item because you want a newer, bigger, or better car, washer, or whatever, the purchase doesn’t make sense. The idea behind a worthwhile preemptive purchase is that you are replacing something that you know will have outlived its useful life soon. If that’s not the case, why spend the money?
4. Your personal situation
If you have a young family where finding time to go shopping (preferably without toddlers in tow) is nearly impossible, give yourself a break. Do as much research and shopping online ahead of time as you can. Be prepared for when your car, fridge, or whatever you’re worried about gives up the ghost and keep your eyes on the flyers for sales. If you have more time on your hands, it would be easier for you to handle an essential going on the fritz unexpectedly.
The decision about whether to preemptively purchase something (or not) is yours. It depends on so many factors that it’s impossible to say “this is the right way”. I hope these tips help!
Have you ever purchased something preemptively? Did you regret it, or did it give you peace of mind?