There are many financial “rules” out there. Dave Ramsey fans know that he advocates only using cash, not credit. Suze Orman says over and over again to never cosign.
These are just two financial gurus, and two pieces of financial advice. Between all of the personal finance books available as well as personal finance blogs, there are literally hundreds of financial “rules.”
How do you know which ones to follow?
If you’re overwhelmed because one person tells you to use cash only and another tells you that you should use a credit card so you can track where all your money goes, take a deep breath and listen to this.
Use this one financial rule to help you preserve your money over your lifetime:
Never buy new.
The Savings Add Up Quickly
Think of all the things you’ll purchase in your lifetime: clothes, televisions, furniture, cars, houses, the list goes on and on. If you buy used for every major purchase as well as the lesser ones, you’ll literally save hundreds of thousands of dollars over your lifetime.
Don’t believe me?
Think about cars. A brand new minivan will likely cost a family roughly $30,000 (and that is for a more basic model). Of course, we all know as soon as it’s driven off the lot, the value of that car plummets. However, you could buy a minivan that is one or two years old for nearly $10,000 less! Use this strategy for all the cars you buy in your lifetime, and you’ll easily save $70,000, if not more!
The beauty of this strategy is that most of your fellow Americans like to shop, a lot! Then they get bored with the purchase or buy other things, so they get rid of their “stuff” cheaply. Take advantage of this!
I like to dress my daughter in Gymboree clothes because they fit her best. Brand new, a pair of Gymboree shorts and a t-shirt run roughly $45. This past weekend, I went to a garage sale and bought her Gymboree shorts & t-shirts for $5 an outfit. I bought her 4 outfits, saving the $160 I would have paid if I had bought it new.
To Buy Used
Thanks to the Internet, it’s easier than ever to “buy used and save the difference” as the Duggars, debt-free parents of 19 children, say.
Some popular places to buy used include Facebook groups, Craigslist, and eBay, just to name a few. Don’t forget to also put out the word to your family and friends. Someone may have just the thing you want sitting in their basement. They may even give the item to you for free!
If you’re overwhelmed with financial advice, start with this basic rule: Never buy new. You’ll likely be surprised at how much you save in just a year or two by implementing this principle.
What items do you buy used? How much do you save?