HOW TO EVALUATE A GOOD BUY

Let me share with you a few rules that have saved us a mint of money over the years. Firstly I must confess to being a bit of a spendthrift. It’s quite disastrous for me to enter a hardware shop. I can see so many good reasons to buy a power tool. I will be able to make endless works of art for the house and save vast amounts of money by not having to call in a technician.

Years ago my wife suggested that we check with each other before buying any item of a capital nature above $20.00. I realized that this would have an inhibiting factor on my buying escapades but nobly assented to the proposition. It has been one of the best rules governing my spending and has enabled us to save for the larger goals instead of frittering our money away on the odds and ends.

The second rule is that we took it in turns to decide what to buy with our special savings money as it builds up. Again my wife suggested a limit of $2,000.00 just in case I had big ideas to save up for a BMW. Over the years it has been real fun to work out what month each partner would be able to achieve his or her goal. We would invariably have a little celebration of some kind to mark the achievement so both of us could enjoy the purchase. Now that our income has shrunk we have graduated to writing out our individual financial goals separately, then coming together to merge them, and finally putting them into order of priority. Then we save up to achieve these one by one not forgetting the treat which marks the occasion.

The third rule has saved a mint of money. We call it the “delayed action” rule. When the shop assistant has made his pitch we say, thanks very much, we’ll be back with within an hour after we have discussed the pros and cons. Time and time again the decision is not to buy. The reason for the delayed action is to give us opportunity to coolly evaluate the purchase without the pressure of the salesman and also to look around for another make which may be a better bargain.
Here are a few questions to ask yourself when considering a purchase.
Do I really need it? Just because it has a bargain price tag doesn’t mean you need it.
Is the price reasonable? Don’t be afraid to check around.
Is this the best time of the year to buy? Prices get inflated around Christmas time.
Can the appliance be serviced? It may be a throwaway appliance that would be a bad buy.

Compulsive or impulsive buying doesn’t reap happiness in the long run.