Accumulating Assets by doing it yourself and retaining the tools for the future... For Sale or for personal use.
Use your skills and buy some tools... tools are an investment that can save you money and even be accumulated for sale at a later point in time when its needed. Good tools retain their value.
Times are tough... Think differently
For a couple hundred years now Americans have been surviving depressions and recessions by being smarter with the assets they have.... and buying only what they really needed. While this Spartan mentality is very far from norm today in the United States it might be high time that it makes a needed comeback.
Many people today are out of work.. many more are trying to work for themselves... Many are trying to do whatever it takes just to survive... keep their family together and make the ends meet.
I want to give you a simple strategy today... something that might not be a quick solution but something that can work steadily... slowly but surely toward a healthier tomorrow... if you use this advice wisely.
Everybody Buys Stuff.
Everybody buys stuff... but only you choose what you "Invest in" and how much you will spend on the "Stuff" you buy.
I am happy to have a wife that thinks allot like me... today. But it has not always been this way. . I mean she was so tight with her money that if you were leaving, she would wave goodbye with a closed fist...
When we were married however she continued this way for a time... but watching the differences in how I spent money... what I bought and why... Time and again she watched as the money I spent on seemingly "silly things" came back... repeatedly. Today my wife is still very tight with the money... but more like I am... tight when it comes to things we do not need... and quick to "Invest" in things that have promise to return its purchase price many times over in use.
Tools can be either a great investment or just clutter...
Tools can be either a great investment or just clutter in the closet... the difference is usually whether the tools were purchased smartly... or foolishly.
Of the tools I have in my closet space there are only a handful that have not already paid for themselves several times. Some on the other hand have been used for Six to Eight Years already and are still going strong. These are what I consider a strong investment... they have returned their $$$ many times over and still have value if I decide to sell or replace them.
Several factors that need to be considered in buying tools:
Purpose: What do you need to do? What are you about to "Hire out" that you know how to do yourself if you had the right tools to do it?
Your ability to use the tool: Buying a tool that you do not know how to use is a foolish investment. But for tools that you already are well acquainted with the tool becomes a potentially lucrative investment.
Does the tool pay for itself in the first Usage? How about in the second or third use? Tools that are nearly paid for in the first use are what I consider a High quality tool investment.
Example: I need to Paint a Barn. I can hire a painter... expensive. Or I could do it myself. (The cost of the Paint will be about the same so forget the paint cost). What we need to consider is "the benefit of doing it yourself VS the hassle of doing it yourself" and seeing if by doing it yourself you Gain a valuable tool.
Lets say the painters want $500 to paint the barn... (Plus Paint) But You know you can buy a Titan XT 290 paint sprayer with extra hose and professional gun and nozzles etc for $375 or so from American Airless on Ebay. The question now becomes: Is it worth it to me to pay myself $125 to paint the barn... If I get a free Professional Paint Spray System in the process?
Next Questions: How much work can I find for this sprayer in the near future? How many times will this sprayer pay for itself? And... Should I keep it? or... Sell if after I am finished with it? How much is it worth in Good Used Condition?
Buy it New or in Good Used Condition: Sometimes as with the paint Sprayer above it is a great savings to buy a Like New factory Refurbished unit.. In this case you could probably use the painter and then sell it in the local news paper classified adds for more than you paid for it. Provided you remember to properly take care of the pump system with oil, cleaning and by cleaning with a special storage fluid before putting it away... (You should do this whether or not you intend to sell it later... or use it later... its very important to maintain your equipment.
Practicality of purchase: Some tools are easy to find.. cheap to purchase and go well with this strategy. But other tools like a Woodmizer Saw Mill require extensive investments. In the case of something like this you would be well to make a decision based on how strongly you feel about using the equipment long term... and also based upon how much work there is for this tool in your area. Right after a Hurricane like Katrina there may be an abundant supply of free timber... But given a year or so the good times are over and lots of people were sitting with saws on hand and little or nothing left to cut.
Price and timing: In the case above a person would have done well to have bought a sawmill and chainsaws etc BEFORE Katrina... maybe just After Kartrina... If the price was right... but the poor investment was when a bunch of people started buying sawmills in a frenzy of trying to get rich quick lumber schemes and were paying exaggerated prices for them.
Just a year or two later the price of these saw mills dropped to an all time low... and once again became a great opportunity for someone to invest in... after the fad wore off... after the supply of free lumber ran out and the market was flooded with good like new sawmills at a very Low Buyers market price.
When you Invest in a tool... look at the big picture... Sometime it can pay you well to wait a month or two until a season rush is over... or to wait for the year end sale etc.
Tax Write off: Do you have a business license? Does the tool fit in with the things your business uses? Can you use it for a write off?
Future usage: How much use is the tool going to get in the future after its initial use? How large is the tool? Is it easily storage-able while not in use?
Retention of Value: If you use the tool a couple of times is it still valuable? can it still be sold easily? For what Percentage of the price you paid for it?
Small do it yourself saw mill
While buying tools over time can be a good investment you need to remember that you will take a hit on the value when you sell the tools. Garage / Yard sales typically attract the bargain hunters who only want to pay 10% of value... or less. Typical mindset of yard sales is $5.00 or less and it will sell quickly... more than that and you are going to end up selling it for a song and a dance.
Tools are best sold to tool users. I prefer using an add in the Little or thrifty Nickel.... or some other cheap classified advertisement.... like maybe Craigslist list or eBay.
Try not to sell your tools at a fire sale... or that is all you will get in return.. a Fire Sale price.