10 things that instantly lose value
Recall the time when you set up that little lemonade stand outside your home. A few supportive neighbors kindly looked down on you and paid the requisite 25 cents for a dixie cup of your way too sugary beverage, sweetly smirking as they did so. You then giddily tallied up your profits and began to fantasize about what you would do with your newfound fortune. A this point an admonishing parent stuck their head in and said “Be smart with your money.” For some of you, this memory is from when you were 6 years old – for others, when you were 32. The point is that the age-old lesson of ‘use your money wisely’ is still applicable today.
Here are ten examples of common items that are essentially the antithesis of intelligent purchases, in terms of value retention.
1 – Vehicles
Most are familiar with the old adage: “You lose half the value once you drive them off the lot.” While moneycrashers.com says that that figure is closer to 35-40%, the bottom line is that if it’s got wheels, you’re losing out on the deal. Obviously having a car, truck or moped is essential for most humans to get from place to place, but you may want to think about purchasing a used vehicle. With a used car you’re not dealing with all the gloss and glitz of a dealership, so you obviously get a better value (just check that mileage first).
2 – Electronics
If you ever think you are going to sell your 48” plasma flat screen off for a price even remotely close to the distant vicinity of what you paid for it, you are in for a high-definition shock. The problem with electronics is that ever developing technology renders older models of things obsolete rather quickly. Products that initially sold for hundreds of dollars (ie – DVD players) now sell, new in the store mind you, for way, way less. Think about the first smart phones, and what you might have shelled out for those, and how they basically come free now with most plans. However, if you have an 8-track player in pristine condition, you may be able to sell that to one guy in Tuscaloosa who swears by that “crisp 8-track quality!”
3 – Toys
This is a tough one to get around, as you are not really in control of the purchase of these expensive and wholly unnecessary items. The kids they are intended for are the ones calling the shots, so there is really very little recourse available to you (unless, you are actually buying toys for yourself, in which case…well there’s not much to say in this case). Toys are often wallet busting (Time.com reported back in 2012 that of the items listed in Toys R Us’s “Holiday Hot Toy List: just five are under $50—and seven run $100 or more”) and never retain any value unless they are “in the original box,” but what kid is going to keep a G.I. Joe or Barbie in a box? Possibly a future collector or financial strategist (aka: an odd child), but most kids will immediately rip the box open and bat the poor figurines around until the heads pop off.
4 – Musical Instruments
These things can really cost a pretty collection of pennies. If you want to pick up the guitar, flute or harpsichord, consider hitting Craigslist for a used one. Many people often find that their sudden passion to play the bass like Gene Simmons wanes the moment they realize how difficult it actually is. Save yourself the frustration and greenbacks; get an old one or, even better, just rent one. If you absolutely have to have a sparkling new one, you can shop around the discount sites; for example, some of the guitars here on overstock.com seem pretty affordable.
5 – Books
While not really that expensive in the first place, books essentially retain zero value. Even hard to find tomes can be located in used book stores for a few dollars at most. What about “collectibles?” Are you looking to retire from the sale of that First Edition copy of Jane Eyre that you found amongst your gramma’s possessions? Sorry to disappoint, but give a perfunctory look at eBay for this item and you’ll sadly see exactly how many more years you need to be part of the workforce for. Why do you think so many sidewalks are chocked full of boxes of books with little signs that proclaim “free!”
6 – Video Games
Yes, yes, yes, you absolutely need to have the newest edition of Call of Duty. Just don’t be surprised if you try to sell it a few months later and receive bupkis. Like all those transitory toys, once you remove the cellophane from a video game, it’s not worth the plastic it’s encased in. Money.usnews.com suggests waiting a tiny bit after a game’s release and then pick it up on Amazon.
7 – Clothes & Apparel
This one really can sting. You can save up for weeks, months even, to get a new suit, dress, pair of shoes or bag, and if it’s a trendy item, you may get one season’s usage out of it. If you attempt to sell your killer threads to a consignment shop or used clothing store (buffaloexchange.com, beaconscloset.com), you will quickly see exactly what last season’s Versace garners today: not much. Just take the 50% store credit, or 30% cash value, get outta there and buy more versatile stuff.
8 – Beauty Products
Granted these things are meant to be consumed, not resold, but they still make the list because of their massive downgrade in value once opened. Totalbeauty.com offers a list of the Most Expensive Skin Care Creams, which lists Cle de Peau Beaute Synactif’s face goo selling at $1,000. Let’s see if you can get anyone, anywhere to give you give you even one/tenth that amount for a freshly opened container of it. If you have a bunch of fancy beauty products that you no longer need (and they are not expired or dried up), you can usually donate them to shelters, as the recipients can be quite grateful to have them.
9 – Food
10 – Jewelry
If you learn the actual resale value of most of the jewelry in your collection, you can be in for a devastating revelation. Here we are dealing with a similar circumstance as the New Car Being Driven Off the Lot…yet, unfortunately, it’s typically even worse (we’re talking around a 70% loss from the retail price). “But why? My diamond ring is in the exact same condition as when it was purchased!” This is a valid argument, but the retail price is insanely inflated above the real market value of jewelry. This is because of all the other costs that go into showcasing jewelry: the cost of mining the jewel, the shipping of it around the world, the labor it takes to cut and polish it, then to fit it into a band or whatever piece it will reside in – plus the costs the store owner has of paying rent, for electricity, hiring salespeople that are forced to always smile at you, etc. If you try to resell your jewelry back to a jeweler, or to a pawn shop, you’ll be lucky to get back 20% (or on a really, really good day, up to 40%) of what you paid. That’s the stupefying reality.
However, there is good news! If you have diamond jewelry that you would like to resell, there is a unique company that can get you the way more money than you could on your own. Welcome to Diamond Lighthouse. We specialize in the sale of diamonds 1 carat and higher, and can find you the absolute best price for them. This is feasible as we put your diamond up for auction to an elite network of professional diamond buyers. These buyers are willing to pay the true market value for your diamonds. In the end, you will receive more than double what you would get at a pawn shop or jeweler. Find out more here.
Once you recover some of the cash from your old jewelry, you will then be free to purchase all the (sure to depreciate) cars, electronics and toys you can get your hands on!