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Wednesday, April 18, 2012

How to save money on big-ticket purchases without going crazy

The most difficult request I get from Spend Less, Shop More readers is when people write looking for 'the best deals' on appliances, laptops, cars, and other big-ticket items.  

The truth is, there's no one best deal or site I can point shoppers to for high-ticket items, particularly when used purchases are ruled out for whatever reason.  

That's because what you need an expensive item to do is often really personalized, and I can't decide for you which options are worth paying for.

For example, what looks like a great deal on a car to someone who drives a lot could be way too much money to someone else who works from home and drives a lot less.

Still, there are some basic guidelines I can offer on how to save money on big-ticket purchases without making yourself completely nuts in the process.
  • Make a list of necessary features before you start shopping.  For example, when I bought a new refrigerator last year, I knew I wanted a stainless steel fridge to match other kitchen appliances -- but that I didn't need to spend extra money on an ice maker, since my older house doesn't have a hook-up for it.  (And yes, it turns out you can still find fridges without them!)  
  • Decide what you need before you decide what you can afford.  If you set a price range before you think about features, you'll probably spend the top end of your price range, even if there are lower-priced models available that better fit your needs.  Time's MoneyLand blog has a great article about this phenomenon that's worth reading.
  • Use your smartphone for instant in-store price comparisons.  If you're in Best Buy and you see a camera you like, for example, price-check the make and model number at Amazon to see if better deals are available.  And don't assume that a bricks-and-mortar store offers the same price as the website for the same chain -- always check both.
  • Don't use credit without a plan.  Take a genuine gut check before you whip out your credit card -- what's your history in paying off bills in a timely manner?  If you're saving money now only to pay loads of interest later, it's really not a deal.  On the other hand, if your family has proven you can pay installments successfully, many furniture and appliance stores offer zero-interest deals for anywhere from 18 months to 5 years that you can take advantage of.  Many credit card companies are also offering crazy high-value rewards right now for people with great credit.
  • Stack sales and rebates or bounce-back offers whenever possible.  For example, I am getting ready to buy a new air-conditioning system for my house, which still has the original AC unit from when the house was built 20 years ago.  So I'm working with the CPS Energy-Savers program, which offers not only zero-interest or low-interest loans, but puts me in touch with reputable service companies that can handle the work.  Then, I can turn around and submit for CPS rebates that reward me for reducing my energy costs.
  • Create a 'down payment'.  Even if the store or company you're buying from doesn't require money down, it's a great psychological technique that gets you focused on paying down your purchase from the get-go.  Here are some simple ways to come up with a down payment for your purchase: sell old gold jewelry; find forgotten money; sell your clutter; review your monthly bills.
Following these six tips will help you find the perfect purchase for your family at a price you can afford -- and cut out the stress from the decision-making process, too.

What tips do you have on shopping for big-ticket purchases?  

Share your hints in the comments section below, or leave a post over on the San Antonio Budget Grocery Facebook page.

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