Advertising
Advertising

7 Things You Should Rent Instead of Buy

7 Things You Should Rent Instead of Buy

The economic pressures we all face are becoming more apparent with more people looking at short-term rental options to cut the cost of purchasing an item they may not need to use often enough to justify the cost. The Huffington Post reports that this new trend has a ton of benefits – from saving money, to promoting sustainable practices.

According to Good Housekeeping ,making new products uses a huge amount of energy and resources; from petroleum products to wood, rubber, metals, minerals and more.

Continually buying new products that you only use occasionally takes up precious space in your home, contributing to clutter and the stress of having to maintain the product.

Advertising

According to One Green Planet, it is better for the environment to rent instead of buying whenever possible. People should always be encouraged to reuse or repurpose items to ensure a greener planet.

Here are 7 items you should rent instead of buying:

1. Tools

Most of us need some pretty basic tools for quick fix jobs around the house but do you really need a full shed of power tools you never use?

Advertising

According to Yahoo Finance the Home Depot rents out a variety of tools for the occasional home repair or maintenance project. For instance, I can rent a 20-inch gas chainsaw from my local Home Depot for $63 a day — a good value, considering that buying one from the store can cost from about $200 to $570.

United Rentals also has over 40,000 pieces of equipment available for rent so be sure to check them out if you are looking for something in particular.

2. Video Games

Not only do video games cost an arm and a leg they also cause clutter and take up space in your home. Rather than owning a million games you never play, it may be more cost effective just to rent the ones you will play. Check out sites like GameFly or Gamerang to rent video games. The service is similar to Netflix and the companies offer large libraries of games to choose from.

Advertising

3. Parking Spaces

Driving into work everyday can become a massive hassle if you are continuously needing to find a park or paying for expensive garage parking. Did you know that people rent out car spaces they don’t need to use in your city? Check out sites like ParkAtMyHouse or Parking Panda to see a full list of rentable parking spaces available saving you precious time and money.

4. Dresses and Formal Wear

You need an expensive designer dress for a fancy party but can’t really afford to buy one? Lucky for you there are now many online renting sites catering the need for short-term formal wear. Sites like Rent the Runway allow users to borrow dresses for 3-5 days for as little as 10% of the retail value. They even send two sizes in case the first doesn’t fit. Lending Luxury also rents out dresses and accessories by top designers, many for 90% off the retail price.

5. Textbooks

The expense of buying textbooks you use for one semester is pretty outstanding, especially when money is already hard to come by. Fortunately there are websites like Craigslist where you may be able to find cheaper second hand books. Alternatively you can rent textbooks for a cheap price from Chegg.com. According to Good Housekeeping, the service is quick and simple, and boasts free shipping on returning books. Plus, Chegg plants a tree for every book users rent, sell or buy. So far more than one million have been planted! Rental costs on Chegg range from about 10% of list price to about 30%.

Advertising

6. Sports and Fitness Equipment

We all know someone who has an entire room of fitness equipment – a treadmill, a cross-trainer, some expensive weight machine…and they never use it. They may have purchased the items with good intentions on getting fit and healthy but just didn’t find the motivation to keep up with it.

The best scenario here would have been to rent the item rather than buy it. According to Good Housekeeping it is not a bad idea to try before you buy, to make sure you really want to pursue an activity before you invest hundreds of dollars in it.

Check out your local Yellow Pages for great fitness equipment rental suppliers.

7. Camping Gear

Although we wish everyday was a holiday, this unfortunately isn’t so. You may want to go camping with the family a few times a year, but before you spend hundreds of dollars on camping equipment, check out your local camping shop to see if they offer rentals as many now do. Websites like Eastern Mountain Sports  or Rent Your Tent also offer good rental deals for camping equipments that won’t leave you high and dry.

Featured photo credit: Janne Hellsten via flickr.com

More by this author

7 Things You Should Rent Instead of Buy cleaning 10 Ways to Fit More Than 24 Hours Into Your Day Think Before You Spend: 5 Questions To Ask Yourself Before You Buy

Trending in Money

1 How to Set Financial Goals and Actually Meet Them 2 25 Killer Sites For Free Online Education 3 10 Recession-Proof Debt Consolidation Tips 4 The Definitive Guide to Get out of Debt Fast (and Forever) 5 25 Easy Tips on How to Save Money Fast

Read Next

Advertising
Advertising
Advertising

Last Updated on September 2, 2020

How to Set Financial Goals and Actually Meet Them

How to Set Financial Goals and Actually Meet Them

Personal finances can push anyone to the point of extreme anxiety and worry. Easier said than done, planning finances is not an egg meant for everyone’s basket. That’s why most of us are often living pay check to pay check. But did anyone tell you that it is actually not a tough task to meet your financial goals?

In this article, we will explore ways to set financial goals and actually meet them with ease.

4 Steps to Setting Financial Goals

Though setting financial goals might seem to be a daunting task, if one has the will and clarity of thought, it is rather easy. Try using these steps to get you started.

1. Be Clear About the Objectives

Any goal without a clear objective is nothing more than a pipe dream, and this couldn’t be more true for financial matters.

It is often said that savings is nothing but deferred consumption. Therefore, if you are saving today, then you should be crystal clear about what it’s for. It could be anything, including your child’s education, retirement, marriage, that dream vacation, fancy car, etc.

Once the objective is clear, put a monetary value to that objective and the time frame. The important point at this step of goal setting is to list all the objectives that you foresee in the future and put a value to each.

2. Keep Goals Realistic

It’s good to be an optimistic person but being a Pollyanna is not desirable. Similarly, while it might be a good thing to keep your financial goals a bit aggressive, going beyond what you can realistically achieve will definitely hurt your chances of making meaningful progress.

It’s important that you keep your goals realistic, as it will help you stay the course and keep you motivated throughout the journey.

3. Account for Inflation

Ronald Reagan once said: “Inflation is as violent as a mugger, as frightening as an armed robber and as deadly as a hitman.” This quote sums up what inflation could do your financial goals.

Therefore, account for inflation[1] whenever you are putting a monetary value to a financial objective that is far into the future.

For example, if one of your financial goal is your son’s college education, which is 15 years from now, then inflation would increase the monetary burden by more than 50% if inflation is a mere 3%. Always account for this to avoid falling short of your goals.

Advertising

4. Short Term Vs Long Term

Just like every calorie is not the same, the approach to achieving every financial goal will not be the same. It’s important to bifurcate goals into short-term and long-term.

As a rule of thumb, any financial goal that is due in next 3 years should be termed as a short-term goal. Any longer duration goals are to be classified as long-term goals. This bifurcation of goals into short-term vs long-term will help in choosing the right investment instrument to achieve them.

By now, you should be ready with your list of financial goals. Now, it’s time to go all out and achieve them.

How to Achieve Your Financial Goals

Whenever we talk about chasing any financial goal, it is usually a two-step process:

  • Ensuring healthy savings
  • Making smart investments

You will need to save enough and invest those savings wisely so that they grow over a period of time to help you achieve goals.

Ensuring Healthy Savings

Self-realization is the best form of realization, and unless you decide what your current financial position is, you aren’t heading anywhere.

This is the focal point from where you start your journey of achieving financial goals.

1. Track Expenses

The first and the foremost thing to be done is to track your spending. Use any of the expense tracking mobile apps to record your expenses. Once you start doing it diligently, you will be surprised by how small expenses add up to a sizable amount.

Also categorize those expenses into different buckets so that you know which bucket is eating most of your pay check. This record keeping will pave the way for cutting down on un-wanted expenses and pumping up your savings rate.

If you’re not sure where to start when tracking expenses, this article may be able to help.

2. Pay Yourself First

Generally, savings come after all the expenses have been taken care of. This is a classic mistake when setting financial goals. We pay ourselves last!

Advertising

Ideally, this should be planned upside down. We should be paying ourselves first and then to the world, i.e. we should be taking out the planned saving amount first and manage all the expenses from the rest.

The best way to actually implement this is to put the savings on automatic mode, i.e. money flowing automatically into different financial instruments (mutual funds, retirement accounts, etc) every month.

Taking the automatic route will help release some control and compel us to manage what’s left, increasing the savings rate.

3. Make a Plan and Vow to Stick With It

Learning to create a budget is the best way to get around the uncertainty that financial plans always pose. Decide in advance how spending has to be organized

Nowadays, several money management apps can help you do this automatically.

At first, you may not be able to stick to your plans completely, but don’t let that become a reason why you stop budgeting entirely.

Make use of technology solutions you like. Explore options and alternatives that let you make use of the available wallet options, and choose the one that suits you the most. In time, you will get accustomed to making use of these solutions.

You will find that they make it simpler for you to follow your plan, which would have been difficult otherwise.

4. Make Savings a Habit and Not a Goal

In the book Nudge, authors Richard Thaler and Cass Sunstein advocate that, in order to achieve any goal, it should be broken down into habits since habits are more intuitive for people to adapt to.

Make savings a habit rather than a goal. While it might seem to be counterintuitive to many, there are some deft ways of doing it. For example:

  • Always eat out (if at all) during weekdays rather than weekends. Weekends are more expensive.
  • If you are a travel buff, try to travel during off-season. You’ll spend significantly less.
  • If you go shopping, always look out for coupons and see where can you get the best deal.

The key point is to imbibe the action that results in savings rather than on the savings itself, which is the outcome. Focusing on the outcome will bring out the feeling of sacrifice, which will be harder to sustain over a period of time.

Advertising

5. Talk About It

Sticking to the saving schedule (to achieve financial goals) is not an easy journey. There will be many distractions from those who are not aligned with your mission.

Therefore, in order to stay the course, surround yourself with people who are also on the same bandwagon. Daily discussions with them will keep you motivated to move forward.

6. Maintain a Journal

For some people, writing helps a great deal in making sure that they achieve what they plan.

If you are one of them, maintain a proper journal, where you write down your goals and also jot down the extent to which you managed to meet them. This will help you in reviewing how far you have come and which goals you have met.

When you have a written commitment on paper, you are going to feel more energized to follow the plan and stick to it. Moreover, it is going to be a lot easier for you to track your progress.

Making Smart Investments

Savings by themselves don’t take anyone too far. However, savings, when invested wisely, can do wonders.

1. Consult a Financial Advisor

Investment doesn’t come naturally to most of us, so it’s wise to consult a financial advisor.

Talk to him/her about your financial goals and savings, and then seek advice for the best investment instruments to achieve your goals.

2. Choose Your Investment Instrument Wisely

Though your financial advisor will suggest the best investment instruments, it doesn’t hurt to know a bit about the common ones, like a savings account, Roth IRA, and others.

Just like “no one is born a criminal,” no investment instrument is bad or good. It is the application of that instrument that makes all the difference[2].

As a general rule, for all your short-term financial goals, choose an investment instrument that has debt nature, for example fixed deposits, debt mutual funds, etc. The reason for going for debt instruments is that chances of capital loss is less compared to equity instruments.

Advertising

3. Compounding Is the Eighth Wonder

Einstein once remarked about compounding:

“Compound interest is the eighth wonder of the world. He who understands it, earns it… He who doesn’t… Pays it.”

Use compound interest when setting financial goals

    Make friends with this wonder kid. The sooner you become friends with it, the quicker you will reach closer to your financial goals.

    Start saving early so that time is on your side to help you bear the fruits of compounding.

    4. Measure, Measure, Measure

    All of us do good when it comes to earning more per month but fail miserably when it comes to measuring the investments and taking stock of how our investments are doing.

    If we don’t measure progress at the right times, we are shooting in the dark. We won’t know if our saving rate is appropriate or not, whether the financial advisor is doing a decent job, or whether we are moving closer to our target.

    Measure everything. If you can’t measure it all yourself, ask your financial advisor to do it for you. But do it!

    The Bottom Line

    Managing your extra money to achieve your short and long-term financial goals

    and live a debt-free life is doable for anyone who is willing to put in the time and effort. Use the tips above to get you started on your path to setting financial goals.

    More Tips on Financial Goals

    Featured photo credit: Micheile Henderson via unsplash.com

    Reference

    Read Next