Gadgets, such as laptops and smartphones, are now part of our lives. I dare say it’s essential to own them if we want convenient access to the internet and optimize our work productivity.
Unfortunately, gadgets are expensive. A laptop that’s suitable for work can cost at least P30,000 or more than a month’s worth of salary for a typical employee.
If you do a lot of video and graphics work, then your costs can go as high as P50,000 to be able to get decent speed and power on your laptop.
Moreover, owning a smartphone has become a necessity for those who need to be constantly connected for work. And in recent years, text messaging has declined in lieu of instant messaging, which has more features and economy.
Likewise, a smartphone normally comes with a hefty price. And unfortunately, it’s a gadget that has a high tendency to get stolen, broken, or become obsolete.
The Consumer Electronics Association in the United States conducted a study on the average life expectancy of electronics. The results of their research are as follows:
- Laptops and notebooks have a life span of 5.5 years
- Tablets have a life span of 5.1 years
- Smartphones have a life span of 4.6 years
It’s important to note that these are average years. Heavy users will experience quicker lifespans for their gadgets. It’s been found that the estimated useful life of a laptop can be as short as 3 years for them.
Next Purchase Planning
If a laptop or a smartphone is essential to your work and lifestyle, then it makes sense to plan for your next purchase because sooner or later, it will need to be replaced.
Most people dismiss budgeting for their gadgets. They simply use their credit cards to buy one when needed. Worse, some borrow money to shoulder this expense.
To avoid going into debt, it’s recommended that you save for your next purchase the moment after you buy a new one. That’s really the money-smart way to do it.
Save, Invest, and then Buy
The financial strategy that I do for buying gadgets can be summarized into three steps.
My ideal laptop currently costs P90,000 in the market. And from experience, the useful life of a laptop for me is 5 years.
If I divide P90,000 for 60 months, this would give me P1,500. This is the amount that I would need to save monthly so I can afford a new laptop after 5 years.
To hedge against inflation, I would invest the P1,500 that I set aside every month in a low to moderate-risk investment, such as a Bond Fund or a Balanced Fund.
Moreover, I automate the investing process so I don’t have to do it every month. I use BDO’s Easy Investment Plan and BPI’s Regular Subscription Plan for this.
At year 4, I check the value of my investment and see if I can already afford a new laptop. If yes, then I redeem my investment and buy. If no, then I wait until I can.
Lastly, for extra cash, I normally sell my old one. I typically use this money to buy some laptop accessories. But if I don’t need any, I just invest it towards the budget of the next purchase.
Investing For a Goal
Investing makes your money grow. But it also helps you afford the things that you need and want. For me, that’s really the purpose of investments.
In this case, saving and investing P1,500 every month ensures that I’ll be able to afford a new laptop when I need it.
Also, it means that I won’t need to settle for something less that can’t meet all my required specifications. And best of all, there will be no need for me to borrow money or go into debt to buy a laptop.
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