We often hear in the FIRE world about how to spend less money. However, there is a difference between being frugal and being cheap. Somebody who is cheap will always buy something for the lowest price while somebody who is frugal will buy something that is a good value.
For example, if you buy a pair of boots that cost $30 but those boots break in 1 year, this is a worse deal than buying a $100 pair of boots that last 5 years. If you have to buy $30 boots every year, you will end up spending $150.
The problem with this is that we don’t always know how long things will last so it is difficult to gauge those decisions in the near-term. However, there is one good trick to both buy something cheaper and make a reasonable estimate of how long that thing will last: how easy it is to resell!
Buying items with a strong resale value has multiple benefits:
1. There is already an active second-hand market where you can buy that thing for a discount in the first place
2. you have some assurance that the product will hold up over time
3. you can sell it again for nearly the same price when you don’t need or want it anymore
If you can achieve #3, you basically got that thing for free!!!
How to recognize if something can be resold easily
- The resale price is often within 50+% of the original price
- There are online businesses who participate in that resale market
- There is a fast turnover of this type of item on the resale market
- The item is classic, durable, and isn’t gross if you buy it second-hand
Items that are easy to resell
- Robot Vacuums – even 5 year old robot vacuums can be sold for a decent price
- High-end office chairs – I bought my Herman Miller office chair for half the price of a new chair, and I had to bid a couple of times to get it! Ikea office chairs often resell for almost nothing.
- Projectors and high-end TVs
- Designer purses, shoes, or accessories
- Persian rugs
- House plants (fake and real!)
- Coffee table books
- Mirrors
- Le Creuset dutch ovens
- Bikes
- High-end camping or sports equipment
- Real metal or stone jewelry (although you should know what to look for when buying second hand jewelry so you don’t get ripped off!)
Items that are difficult to resell
- Technology that is no longer relevant
- Most clothing, especially fast fashion
- Couches
- Mattresses, pillows, blankets, bedding in general
- Most cookware and dish sets
- Tchotchkes and personal decor – not everybody wants a poster of your favorite band!
- Anything from Ikea
- Non-hardcover used books
That’s not to say you shouldn’t buy any of the above items second-hand. In fact, it might be easier to find a really good deal on those items as long as they are clean! But I suspect it will be difficult, if not impossible, to resell.
What items have you bought that were easy to resell?