11 Big Purchases
Big purchases aren’t always something to feel guilty about. After a few decades, years, or even months, there are plenty of items that will begin to pay for themselves and then some. Here’s when to expect to see a return on 11 major investments.
1. TUXEDO // 3 TO 4 WEARS
A standard tux can easily go for $500 or more, which makes renting a tempting option. But if you plan on attending, at least, a few weddings in your lifetime, you’ll be glad you made the investment early on. According to one recent report, the average cost to rent a tuxedo in 2015 was close to $200. If you attend enough events, buying your own tux can easily pay for itself within a year. And unlike an expensive dress, no one will notice if you wear the same outfit back-to-back.
2. HYBRID CAR // 1-11 YEARS
It’s true that hybrid cars save you significant cash at the gas pump, but just how far these savings will take you depends on the price of the car itself. Lower-end models, with prices that are on par with similar gas-powered vehicles from their brand, don’t take long for drivers to recoup the purchase price. Those that are relatively more expensive are likely to break even within four to five years. And if you’re willing to shell out up to $25,000 extra to upgrade to higher-end hybrids, make sure you’re doing it for the environment—not the sake of your wallet—as that up charge could take up to 11 years to pay off.
3. COFFEE MAKER // 2 MONTHS
A $4 latte doesn’t feel like a bank-breaking expense in the early morning hours when you need your caffeine fix, but by the end of the year, those small purchases add up. If you buy one latte before work every day for a year you’ll end up having spent nearly $1000 on something you could have made at home. Instead, treat yourself to some gourmet coffee beans and a quality coffee maker. Even if you spend $80 on a fancy machine and $10 a week on beans, you’ll make the difference back in 2 months. You may even end up liking your home-brew more than the stuff from your local cafe.
4. COLLEGE EDUCATION // 20 YEARS
College tuition prices are higher than ever before, but thankfully, the fancy degree pays off—as long as you’re willing to wait to see a return on your investment, that is. One study published last year shows that college graduates earn $1 million more than high school graduates without a degree over the course of a lifetime. While that sounds like a major bonus, it still takes nearly 20 years before that four-year degree becomes profitable.
5. SOLAR PANELS // 7-20 YEARS
One of the major incentives to switch to solar is to save money otherwise spent on electricity bills, but in order to get there, you first need to make a big investment. The average cost of solar panel installation is $17,000 in the U.S. through tax breaks and other discounts can make it as low as $5000 in some states. The savings you earn by going solar can take anywhere from seven to 20 years to cover the initial cost. But the average savings after 20 years? A whopping $20,000. In addition to cutting down on your monthly energy bill, solar panels also offer the benefit of adding value to your home.
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