Are you spending dollars to save pennies?

Penny Wise Pound Foolish

 

Suppose for a moment you’re shopping for a new car.  You’re not extremely picky about its features.  You don’t need built-in GPS, leather seats, or a premium sound system.  It only serves as your mode of transportation from point A to point B.

At the first dealership you visit, the salesman points out a very inexpensive model.  It’s your basic car – no bells and whistles.  It has a set of tires, a clean engine, and looks reliable.  This car would most likely meet your needs.

You decide to check out a second dealership to see what they have.  The salesman there offers you a similar car.  It doesn’t have any of the fancy add-ons, either.  It too has a set of tires, a clean engine, and looks reliable.

But it’s more expensive than the first car you looked at.

What you don’t realize are the hidden, yet important, differences between the two cars.  Many “features” of the second car make it much safer for you to drive, guarantee it will last longer, require less frequent repairs, and overall provides a more pleasurable experience.

If you chose to buy the first car because it was cheaper up front, you would find out that the constant frustrations and repairs it needed over time would make it more expensive than the second car.

This is known as total cost of ownership.

Unfortunately, I see many people fail to consider total cost of ownership when buying a new computer – especially around Black Friday and Cyber Monday.

Big box stores advertisements scream that you can get a laptop for $180.

But as Time magazine reported in October 2012: “While the main supposed draw for Black Friday is good deals and ultra-low priced “door busters,”… pricing studies… highlighted the fact that Black Friday didn’t offer the best value for shoppers, especially when it comes to popular holiday purchases like electronics and toys.”

Did you notice the one key phrase in their statement?  Didn’t offer the best value.

You can buy all sorts of items at low prices. But the real question is, are you getting something of value?

Answer this question honestly:  Do you seriously think you’re buying a quality, long-lasting laptop when it’s priced at only $180?

The only way manufacturers and retailers can offer these computers at such ridiculously low prices is because 1) they’re made with lower-quality components that have a higher failure rate and 2) they’re subsidized by software companies that load up the computer with junk programs that slow the computer down by as much as 40%.

I’ve seen plenty of these cheap computers (desktops and laptops) come into our shop just a few months after they were purchased.

They have problems like:

  • the hard drive had crashed (thus causing the user to lose all their data files) or
  • the computer wouldn’t power on because the motherboard died or the power supply had failed.

When you buy one of these cheap computers on Black Friday or Cyber Monday, you’re throwing your hard-earned money away.  

You save a few bucks now, but end up spending way more in the end – either paying for repairs or having to buy another, usually more expensive, computer to replace the cheap one.

A second reason to avoid the Black Friday/Cyber Monday computer specials is because all of the PCs at the big box retailers will come with Windows 10.

While Windows 10 does offer some benefits – such as a functional start menu and slightly faster performance – it is still plagued with problems.  Just like its awful predecessor Windows 8.

  • Incompatible software programs.
  • Printers and other devices that don’t work with it.
  • Errors caused by faulty updates
  • And an endless list that I don’t have room to include

The biggest concern with Windows 10 concerns Microsoft’s lack of care about your privacy.

In a 45 page document, Microsoft basically grants itself very broad rights to collect everything you do, say and write with and on your devices in order to sell more targeted advertising or to sell your data to third parties.  Microsoft appears to be granting itself the right to share your data either with your consent “or as necessary.”

Here’s the most troubling statement from their new policy:  Microsoft “will access, disclose and preserve personal data, including your content (such as the content of your emails, other private communications or files in private folders), when we have good faith belief that doing so is necessary to,” for example, “protect their customers” or “enforce the terms governing the use of the services.”

The definition of “good faith belief” leaves the door WIDE open to interpretation. 

Hello, Big Brother!

Bottom line is this:  I don’t like seeing people get suckered into buying something that isn’t truly a good purchase and a wise use of their money.

I like a good deal as much as you do.  But I’ve learned it’s often best to save money by paying a little more up front.

I’ve wasted enough money trying to save pennies by spending dollars.  Haven’t you?

Scott Hartley, President/CEO

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