10 Things You Shouldn't Buy New, Part 4

Here's part 4 of a piece from Money Central titled "10 Things You Shouldn't Buy New":

Cars -- The average new car loses 12.2% of its value in the first year, according to Edmunds.com; on a $20,000 car, that’s $2,440, or more than $200 a month. Some cars depreciate even faster, depending on demand, incentives offered and other factors.

Why not let someone else take that hit? Not only will you be able to save money (or buy more car), but you’ll pay less for insurance. Cars are better-built and last longer than ever before, which means you’re less likely to get a lemon. Companies like CarFax allow you to trace a car’s history. Many late-model used cars are still under warranty, and a trusted mechanic can give your potential purchase the once-over to spot any problems.

Exception: You can pay cash and you really, really want that new-car smell.

We buy new (with cash) and drive the cars forever. We buy highly-rated vehicles that tend to have lower repair bills and run well all their lives. To me the extra cost is worth it to have a reliable car that you know has been taken care of all its life.

Software and console games -- Buy used, and you’ll pay half or less what the software cost new. Console games like those for the Xbox and Sony PS2 that list for $50 new, for instance, can often be purchased used for $20 or less a year after release.

But it’s more than just a matter of economy. Letting someone else be the early adopter also allows you to benefit from their experience. You’ll find more reviews and information on software that’s been out a year or more (and you won’t be that far behind the leading edge). The bugs will have been identified along with any workarounds, although you may have to live with some problems that are fixed in later versions.

Exception: If you do a lot of work with graphics, multimedia or image editing and you have a newer, more powerful computer, you’ll probably want the state-of-the-art version. Finally, some software restricts the number of computers on which it can be installed, which can make it difficult (but not impossible) to transfer the product license to a new owner.

I don't buy much software -- what I need is generally provided though my workplace. However I do usually wait a bit to get software. The one piece of software I do buy regularly -- Quicken -- I do not upgrade every year (probably every other year at most).

Click here to read part 5 of this series.

Comments

[http://financenstuff.blogspot.com/]

Hey noticed you linked to my blog. Thanks a lot. I too may buy my car new. I don't know too much about cars so I am worried about having car problems. And since I commute a lot I think I should stick with a new car. Anyway thanks!

[javasoy]

We bought two new cars to replace our two old cars. Sounds pretty bad, except we got them when the big rebate war was going on among the Detroit big-3. We intend to keep the cars forever. (although nothing is forever) Also, we bought small fuel efficient cars which don't depreciate much. As a result, our yearly depreciation+maintenance cost+fuel cost is actually lower than a used car. plus i got rid of the headache of having to put my old Explorer in for a fix job once a while. Win-Win-Win situation form

[Anonymous]

Of course with the terms in Microsoft's EULAs these days, it is clear that they want to be sure that every single PC ever sold requires a freshly licensed copy of their software. Ask yourself honestly whether you need Windows and MS Office. I've been happily using Linux for years. I'm using OpenOffice. There are several good browsers available under Linux. If you want the no-brainer choice, Firefox just works. If you get adventurous, Konqueror is fast and capable.

The only thing I can't run under Linux that I want to use is Quicken. *Cough* *cough* Are you listening, Intuit?