Reduce Your Spending By Being a Late Adopter
Filed under: Frugal Living
After years of waiting for the game and nearly 11 months since it’s release, I finally purchased The Orange Box for PC. I played Half-Life and Team Fortress all through college and I loved the community that built around the games. When Team Fortress 2 was announced, you can imagine my elation at the news.
Well, last year around this time is when I started realizing our spending was out of control and I had to take steps to reign it in. The first thing that was cut was “frivolous” entertainment expenses - including the funds to purchase the game. Doing a little looking back, the best price for pre-ordering the game was $44.99. While I’m sure we had the money at the time, I would have just been repeating old mistakes if I had pulled out the credit card right then.
Fast forward today, I spent $30 on Amazon with money I had set aside in a budget for entertainment instead of just spending it haphazardly. By waiting nearly a full year, I saved $15 and am enjoying a game that’s been perfected over the past year.
By being a late adopter on new products, especially technology-related, you can save significantly.
Wait Until the Next Version Is Announced
Shortly after the newest revision of a product is announced, the existing stock will start getting marked down as used equipment starts flooding the channel. Consider the iPod, while even older models do a decent job of holding their value, the “going price” on eBay drops considerably for each older revision you see. While you may sacrifice the newest bleeding-edge features and storage capacities, your potential savings more than make up for the “loss.”
Lag Behind At Least Three to Six Months
Video games have a very distinct sales curve that starts high and tapers off quickly to a long, steady descent. While sales are hot for your chosen product, the manufacturer and retailers will be unwilling to make any significant price drops. Once the product has had a chance to cool on the shelf and collect a little dust, the retailer will want to move out the old product to free up shelf space for the next big game to release. I recently purchased Super Smash Brothers Brawl in June, utilizing Amazon’s Gold Box discount, for $26 - $24 less than the price on the day of release just three months before.
Buy Last Year’s Model
While software and video games may make large advances every year, cars and computers don’t make quite the same leaps. Yes, by running last year’s retail Dell, you won’t get to claim you’re running the latest Intel Quadrillion Core 3 with 20 gigs of RAM and a 3 terabyte hard drive, but you will get a machine that can more than meet your needs. When I was a computer salesman in one of my first jobs, I would point out the “latest and greatest” but always remind my customer that the cheaper model could do most of the same things. Of course, that didn’t make my boss happy and it reduced my commission checks, but I tried to always make sure to sell the right computer for the customer (and most could have handled a model from two or three years ago).
And cars are even slower to advance than computers. Outside of the luxury features on brand new vehicles, there’s nearly nothing a basic entry-level vehicle from this year can do that last year’s model can’t. Of course, you could always buy used and save even more, but you can still save on new vehicles by waiting a bit.
Ignore the Joneses and Love What You Have
Marketers will try their best to convince you that you’re nothing without the latest gadget. We’re all vulnerable to their advances, but if you stay smart about your purchasing and exercise some patience, you can save a significant amount.
September 18th, 2008 at 3:35 pm
great advice - thought hard to do. I love gadgets and it takes a real effort for me not to have the latest. But i am getting better, haven’t bought the 3G iPhone yet….instead I bought the stock (not such a good move to date!)
September 22nd, 2008 at 8:34 am
[...] Are you a late adopter or early adopter when a new product comes out? Having worked in the software industry for as long as I have, I am always leery about buying a dot-zero or dot-one release of any software. There are just too many bugs. One Caveman’s Financial Journey has a good post on why it makes financial sense to be a late adopter. [...]
September 22nd, 2008 at 1:28 pm
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September 22nd, 2008 at 2:23 pm
Great post! This is a technique I try to use as well… It is tough sometimes, but the amount of cash you can save is huge!
September 22nd, 2008 at 6:01 pm
I follow this practice with my laptop. I usually buy a used Mac a little while after major upgrades are announced. Often times I can still find ones with an extended warranty.
September 24th, 2008 at 12:45 pm
I just did this exact thing recently. Instead of buying a new model digital camera for $200 or more we ended up buying a 2 year old model that was just as good for around $100. Sometimes you want to buy the newest and the “best”, but it makes a lot more sense to buy something a little older. Usually you won’t notice any difference.
September 25th, 2008 at 9:17 am
[...] I am a late adopter, mostly because of price. I know that sounds weird for someone who uses so much technology on a daily basis, but I don’t like spending a lot of money. I still remember when the first CD players came out and cost like $5000 or something. One Caveman’s Financial Journey discusses how being a late adopter can save you money. [...]