Refurbished GPS units save you money. Period. You like saving money or else you wouldn't be here reading about how they save you money. You are probably feeling the pinch at the pump, grocery store, and on your mortgage but you still want to be able to buy an frivolous gadget. So you have turned your gaze to the end all and be all of cheap yet reliable products - the refurbished market.
Refurbished items are those that have picked up a defect some place along the production line. It could be that a part of the LCD display was scratched by a machine or a careless employee. An internal component could have been faulty from the get go and produced an error in the devices functionality. Whatever the reason, the device is now up to production standards, usually will come with a warranty, and is offered at a significant discount from the 'new' item.
The significant discount is what you are all about. But how significant can these discounts be? A quick perusal of some of the current prices on both a 'new' and refurbished GPS show that the discount for one particular model is 23.45%. This will be our baseline in determining how much purchasing refurbished can save you over the long term.
We will also assume that you are GPS crazy and like to buy a new model every three years (this is probably not true, but this is just a thought experiment).
After 1 year you buy your GPS you save $45.96. You then take this money and you put it in an interest bearing account. After three years you have a balance of $51.05 after your interest acrues and taxes are taken out of it. This means that your savings have now grown by $5.09 in this first buying phase.
That is a nice savings, but it gets even better once the savings from the second year are added to it.
Now a third GPS is purchased with inflation adjusted prices and you find that you saved $50.22 on your purchase. Add that to the ammount that you already saved and earned in interest and you will have $101.27. This will then grow to $112.48 by the end of the next three years.
As you can see the savings are beginning to add up.
If you conitnue this pattern for the next 30 years (so 10 buying cycles total) you will see amazing results and watch your savings on your refurbished GPS rise all the way to the sum of $1221.81. That is a heafty sum.
But what if you could increase your rate of return by investing the savings into stocks or buy using it to start your own business?
With just a 9% return you could see that money become $2931.51 and if you continue to grow that money at the same rate you could have enough money to buy yourself a GPS every three years for as long as you are likely to live.
All that stems from the choice to save money with a refurbished GPS and to be wise about how you would invest it. It is a no brainer. |
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