Coming up to winter here in Montana, if you have a 2 wheel drive Honda, you're gonna need studded tires. For us, since our ‘big purchases’ are anything over $100, buying studded tires for my car was a 'big purchase'. We had already had $600 put away because we budgeted $100 into savings every month specifically for car emergencies and expenses. We needed tires for my car plus new front seats for our Ford Explorer. We decided to budget $450 and only get tires since that's all we could afford and still have a little buffer left over just in case.
When considering what is a “big” purchase make sure to discuss how big is ‘big’ per your family’s set budget. Is it $50? $300? Collaborate and agree with your spouse even before budgeting for something specific. Also, decide whether it’s something that needs to be bought new or if you can settle for used (usually the cheaper option). Pre-planning is key throughout each step of making a ‘big purchase’.
Getting a retail quote is helpful when pricing things so that you know if someone is charging you more for something used than you would pay new. Remember, retailers mark up their items, usually 50-100% to cover their cost of operations. You don’t have to pay this markup when purchasing used goods from private parties. This happens often with furniture. If you find a piece of used furniture you like, just run a quick search on the brand's website, Overstock.com, Ikea or maybe a furniture retailer's website. You’re looking for something to give you an idea of prices. I won't pay more than half price for used furniture, no matter how new or wonderful it is. If they say they paid $3000 and are 'sacrificing' for $2500, too bad. They shouldn't have overpaid in the first place.
Before we started looking for tires, I went into a tire shop and had them run a quote for four tires and rims for my car. The quote for tires came back $671. That tells us our budget was reasonable and chances were good we would find newish tires with little wear. With that information in hand, we started searching our local Craigslist and Facebook classifieds. We decided ahead of time how much wear was acceptable, and how much we were willing to spend ($450). And while buying used items online is also a risk, if you plan really well, then a wonderful world of amazingly good deals opens. You will have to give up things like warranties, return policies and custom options. However, if your budget is tight and you are willing to go without those things and can handle a little wear and tear, you will save huge amounts of money. I’m talking 50-80% off retail prices.
Also, PLEASE know what to look for BEFORE you go searching. It’s not a good deal if you’re getting something you can’t use. For our purchase, my husband already knew how to buy tires. Just by looking at them, he can tell how much wear is on them (people will lie about that), how they were stored (which is important since the rubber can break down quickly if stored improperly) and if they'll work for our car. I wouldn't have had half a clue. If you're looking for furniture, measure the space where you're going to put it AND the door you're bringing it in. If you're buying electronics, meet somewhere where you can plug it in and test it and ask the seller to bring the user manual with them if they still have it.
My husband found a few different options with one set of tires looking especially promising. I think the guy was originally asking $450 for 4 tires on rims. We contacted the seller, but somewhere along the line he stopped contacting us. We thought that opportunity lost but then he reposted the tires shortly after for $400. So when husband went to go look at them, he offered $300 and the guy took it! For much less than half price, we got snow tires and rims for my car. Granted, they're badly painted black and pink and my car is white, but whatever. A little sandpaper, masking tape and a leftover can of spray paint and you’ll never know. We saved $371 off retail and $150 off our budget! Lesson learned: Don't be afraid to ask for a deep discount, you never know if they'll agree or not. However, if you're the one selling, don't be afraid to refuse to give a deep discount if someone asks for it.
Since we got the tires so cheap, we were also able to get seats for the Ford for $100, putting us at $50 under our original budget of $450 just for snow tires. Cha. Ching!
Additional points to remember:
Don't get sucked into good deals. There are LOTS of good deals out there, and when you see one, remember this mantra: If you see an elephant for sale for a quarter, it's not a good deal unless you have a quarter AND you need an elephant.
Treat online shopping like you would Goodwill shopping. Have a list of specific things you're looking to buy and stick to your list but keep a little part of your mind open for unusual and wonderful things. You never know what treasures you’ll come across.
When you find something you want and start to communicate with the seller, be cheery and polite. If the ad is very new, lowballing (in my experience, 30% or more off asking price) is considered rude. If you think it'll still be there, wait a day then make a low offer. If it looks like it's going to go fast, for instance if a few other people are showing interest, pay their asking price or offer just a little lower (maybe 10% off). Most people are ok with bargaining a little, but if they say no, be gracious and either pay the full price or walk away. Remember you both have an advantage, they have a desirable item to sell, but chances are good that someone else is going to sell something similar again in the near future.
Once you meet with the seller, check the item over thoroughly. Don't just blindly throw your cash at them and leave. Most people are honest, and sometimes they make honest mistakes. Some people are crooks. If you get ripped off, then you're not saving money. You're wasting it. Learn to protect yourself from honest mistakes and crooks. If there's something wrong that wasn't disclosed in the ad or subsequent communications, but you're ok with it ask if they'll take a lower price or just refuse to buy it. It's OK to not buy something even though you both took the time to go meet each other. If you're the one selling, be sure to count the money given to you before you send the person away. I'll even tell them to wait while I count just to make sure. Nobody has ever had a problem with that. Just think about when you buy something from a store. The cashier counts your money before they put it in their drawer. It's not rude. It's normal.
I hope these tips help you save buckets of money in the future! Be safe and be frugal!