This is a great thread. I don't usually surf this board, but today I stopped by and discovered this thread, as well as the one about cutting back on eating out in order to save money. It was particularly interesting to read the agonies of the reforming shop-aholics. At the risk of sounding "preachy" I would like to offer some encouragement and food for thought to those who are making an effort to stop frittering their money away. Look around your home. Look at the furniture, household items, clothes, gadgets, and all the "stuff" you own. Think about how much all that "stuff" cost. Now, think about how much it is all worth if you needed to sell it, for whatever reason, next week. For the most part, even the nicest items you own would probably bring half what you paid for them, even if you bought them recently. Most everything else would bring a quarter, or a tenth, of what you paid.
To me, this realization takes the joy out of buying "stuff." What a waste of money! The more of your income you can put into assets that don't depreciate, and hopefully increase in value, the more you are building wealth. I am not saying that people should not buy furniture or clothes, or household items, but think twice about whether the item is something you really want or need badly enough to justify owning something that will immediately be worth a fraction of its price new.
Part of this perspective comes from the fact that DH deals in antiques and collectibles. Generally, antiques hold their value or increase. Used modern furniture and household items typically sell for pennies on the dollar. We just helped our in-laws, who lost their home in a fire, replace some of their belongings. Of course the insurance company (and mortgage lenders) consider the value of your belongings at the cost to buy everything new. My in-laws were stunned when DH started quoting the replacement prices for used items, similar to the ones lost in the fire. They couldn't believe things could be replaced so cheaply once they were "used" a bit. We took them to a local household auction. They bought a nearly new couch and chair and paid $430. We saw the same exact furniture last night at Bon-Ton at about 40% off and it still cost over $1,000 on sale. They bought a nice bedroom set for $375 that would certainly have cost at least $2000 in a furniture store. Decent dishes and general household items can often be purchased as "box lots" for a few dollars.
Most of what we own has come from eBay, auctions, estate sales, etc. and it is generally far better quality than we would feel we could afford if we had to buy the equivalent items new.
I realize most people don't have time to go to auctions, and some people don't like antiques, or are uncomfortable with buying via eBay. The point is, it is helpful to be aware that your purchases are not adding to your net worth, and in fact, are diverting money away from true wealth. Next time you are tempted with that $180 lamp, remember that a year from now it will probably bring $40.00 at auction, and the lamp may not seem so appealing after all.
. I would buy new too. Our set is 7 years old, but still hanging on. When the kids are done making a mess of it we will buy another new set. Hopefully, on sale.
