Thursday, May 08, 2014

Buy low, sell high - how to buy almost anything you want without guilt or buyers regret

I tend towards frugality and don't go shopping very often. I just don't like spending the money, I tend to think I'm being overcharged, and I get buyer's remorse frequently.

But there's an exception - buying used items, and then selling them for more than I paid. For instance - years ago I purchased this vintage school desk/chair combo for $20.

It hasn't been getting used recently, so I put an ad on Craigslist with some decent photos, and good descriptive text, asking $50 for it.  I settled for $40, and shared the money with my kids (they don't get an allowance, so this helps motivate them to sell their old things).

Another recent sale - I had bought my kids two huge bags of Duplo legos for about $15 when they were younger, one from a garage sale and one from a private school rummage sale. They were played with regularly, but now even my younger son is more interested in the standard legos, and the Duplos were just taking up too much space in the closet.  So I took some nice pictures, also including one where the kids had built an enormous tower that reached to the ceiling.

We were able to sell that for $60. I wish I could get that kind of return on my investments!  And, of course, we got about 5 years worth of great playtime from those legos.

One last example - before the kids were born, I bought a canoe for $200.  After years of use, with lots of fun trips around the area, I sold it for $250. Not as good a bargain as the legos, but still - I sold it for more than I bought it.

Here's a few tips for this kind of guilt-free purchasing:
  • Buy used  Unless you REALLY know what you're doing, this is not possible with new items. It's not as straightforward to buy things used, but it adds to the challenge and slows down your consumption.
  • Buy classics  A vintage desk, duplo legos, a simple, a standard canoe - these are all classics. They preserve their value and don't go out of style in a few years.  
  • Write a great ad  Especially for higher value items - make an effort to take lots of good photos for your ad, and write up some nice descriptive text.  The more descriptive, the better. I think it also reassures potential buyers that you're not a flake, since you can put together a well-written ad.
  • Wait for your price   Don't be too eager to sell it soon.  If you get a full price offer within a few days, you've probably priced it too low.  On Craigslist, it's best to create an account and login with that account instead of anonymously. That way, you can repost the ad easily and don't have to recreate it every week - this makes it easier to wait for the right price.
Also, I found this great article from Mr Money Mustache with lots more tips about buying and selling on Craigslist. He also mentions the concept of "storing" an item on Craigslist. Basically - if you have, say, a motorcycle that you're not using, sell it on Craigslist.  If in the future you want or need one again, then simply purchase another motorcycle on Craigslist. That way, you haven't had to deal with depreciation and storage. This doesn't work for heirlooms, but for most items, it's a great strategy.


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