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Friday, 26 June 2020

Buy New, Repair, Or Throw?


What an interesting turn of back-to-back events!

First, my digital watch which I seldom wear - the one with thermometer, altimeter, compass built-in - has the liquid crystal leaked so that the display is now a black smear...

I went to the internet and saw we don't repair watches anymore; they simply change the whole module. 

The damage would be $100 to replace.

Let me see... I bought this watch for $250 more than 10 years ago, thinking how cool it is the wear it for my long walks. 

But then, when was the last time I used it to tell the temperature, direction, and elevation during my city walker treks?

Eh...

Guess what I did?

I threw the watch away. 

No replacement with new as I have another 3 watches anyway.



Then my instant water heater died on me last Friday. 

Come on! 

I'll be moving to my en-bloc new flat end of this year. Die on me now?

I have no problem showering in the cold, but mom needs her hot water showers.

Had an argument with mom who insisted on repairing, while I wanted to buy new.

Mom's generation had the repair mindset, thinking repair is cheaper than buy new.

I had to prove to her no one repairs instant water heaters; its always replacement. 

What the repairman will do is to say come repair, then say cannot repair and suggest a replacement unit - that's how they snake oil uninformed housewives who are now captive customers... 

Hello, I work in this home appliances industry remember?

Found a cheapo China brand online for $70, install $50 - so $120 for 6 months of use max. I just treat it that I've "rented" this instant water heater for 6 months.



Guess what?

Dad called me in the morning just now. 

Yup, his fridge went to sell salted duck eggs...

Son, do you know anyone who can change the Freon refrigerant? 

Dad, can I buy you a new fridge this weekend at my workplace? One that's more energy efficient? 3 ticks?

Your that ancient antique fridge for more than 20 years is bloodsucking your energy bill every month... 

I pay lah! (That's how you win the argument)



You know what?

I realised the above 3 scenarios can be applied to our stock investing journeys. 

The problem with investing is we often let emotions get in the way of logic. 

No wonder more institutions have moved towards systematic and algorithmic trading strategies...

Can you relate them to your existing stock positions?













21 comments:

  1. Hmmm... repair means, we average down? or we want to win back the money with the same counter? When we can just throw it out and get a brand new one?

    But only we ourselves need to be clear of our context, something keep long enough can go to antique level.

    I can't find my father coal powered clothes iron. Damn cool ok.

    There are things that repair really cheaper, think of a car.

    Also, dun buy at the first place, won't spoil won't heartache and people won't scold u wasteful...

    ReplyDelete
    Replies
    1. Sillyinvestor,

      Of course context is important.

      Sometimes no matter how expensive, we'll repair because of sentimental value - human emotions at work again...

      Then there's situations where property valued at $500K, renovate for $50K all of sudden can sell for $700K!

      In REITs language, its called Asset Enhancement ;)


      Sometimes we don't have to win back the same way we lost as espoused so eloquently by CW ;)

      Some stock no matter how much we repair, it will not come back to life one...

      Or even if it does not die, the running costs to maintain will slowly bleed us dry...




      Delete
  2. Ha! My parents' washer died one day for no reason. No point doing the repair route and risk having it break down again.

    Went online and buy a brand new one that's easy to use for $300+, delivered next working day, so fast! Figured it can last 3 years is already worth the money. Spend money to make the problem go away.

    Last time appliances can have no ticks, now cannot?

    ReplyDelete
    Replies
    1. Kevin,

      You gave me an opportunity to share the art of buying home appliances when it comes to these energy savings ticks.

      Let's take aircon. If one is cheapo and only turns the aircon on only during hot nights, then a 2 ticks model one would make more sense as ticket price a lot cheaper than the latest 5 ticks ones.

      The energy savings from a 5 ticks model is minuscule when usage is so low and infrequent...

      However, if one turns on the aircon the moment we reach home no matter what the weather outside, then its a better buy to pay more upfront as the monthly energy savings do add up and more than pay for themselves over time ;)


      A fridge is always on 24/7, hence I would go for the highest 3 ticks models, all things being equal. In Singapore, we have no 4 to 5 ticks fridges yet.


      Then there's your parent's case.

      How many ticks do not matter. Nor all the bells and whistles functions in the world.

      What matters most is EASE OF USE ;)


      Then again, how many salespersons will both asking how the customer intend to use their purchase (consultative selling)?

      Its a lot easier to promote the products that give us the most commissions!

      LOL!

      Delete
  3. Hi SMOL,

    Just curious, instant water heater cannot move when moving house?

    Repairing runs the risk of breaking down again, at least buy new got warranty! That's why I threw away my Solvil and Esprit watches (and now wear the durable FOC Fitbit).

    ReplyDelete
    Replies
    1. Rainbow girl,

      Of course can.

      If our water heater is "attas" one that cost a lot or we are sentimentally drawn to it like Linus' security blanket (Charlie Brown comic strip)?

      But my new cheapo one costs only $70 (cost of a fancier meal?). Most instant water heaters would cost between $150 to $250. Cheapest one at my weekend sales gig is $98.

      The cost of installation for a new unit is $80 (must install new wiring and extend water pipe).

      Cost for replacing an existing water heater is $50 (use existing wiring and pipe)

      To uninstall this new water heater and reinstall to my new place?

      Where got meaning when the installation costs alone would exceed the cost of my water heater?

      I know its a waste.

      That's why even though I hate to buy things online, I decided to find a "disposal" water heater cheaper than the ones I can get at my weekend sales gig! No wonder so many people prefer to shop online!

      For my new BTO, I would like to take advantage of the new concealed piping and buy that instant water heater where one can provide hot water to 2 bathrooms at the same time.

      No, for better stuffs, I don't buy online. I practice TIP (To Insure Performance).

      I don't mind paying a bit more by buying from a physical store with SERVICE from a real person ;)

      Delete
    2. Hi SMOL,

      Thanks for the "tips" about water heater. I totally get your point.

      Nowadays I really bought most electronic stuff online, partly because of the cheaper price (with promo codes all thrown in, although those shipped from China would take longer to deliver) and also to avoid getting snake-oiled to get "better" models. Philips tv I bought at $139, Xiaomi home cam at $29, SD card $4. The only time I don't buy from online is if I need it urgently (so cash & carry home).

      Delete
    3. Rainbow girl,

      If the Philip TV is 32 inch non-smart, my weekend brick and mortar retail outlet is selling for $159 - cash & carry ;)

      I guess its a generational thing or maybe its just me.

      Like that time when I preferred to wait in queue to deposit a cheque at the bank. The maternal 50+ jie jie smiled and told me I could have easily deposit my cheque at the drop cheque collection box outside and save my time queuing...

      I told her if I did that, I wouldn't be able to enjoy her pretty smile :)

      I tell you, I made her day. I'm an incorrigible flirt...

      LOL!

      Delete
  4. Replace your broken $250 watch free of charge with smart-phone apps.

    Thermometer

    Altimeter

    Compass

    I don't know how accurate are the measurement results of the apps. Since your watch is 10 years old technology, it should not be hard to beat.

    ReplyDelete
    Replies
    1. yom,

      I've hinted in italic that outdoor trekking watch I seldom wear ;)

      1. Thermometer - I only need to know the temperature when I'm indoors - when its a hot, hot day. And that I have a home thermometer.

      Whenever I'm outdoors, I've never been curious what's the temperature like... When its hot, I'll rather find shade or find an aircon shopping centre ;)


      2. Altimenter - this one lagi embarrassing. Why would I need to know the elevation walking in Singapore? I mean if I curious how high Mount Faber or Bukit Timah hill are, goggle online can oredi!


      3. Compass. Eh... If I'm lost in Singapore or overseas, I think using goggle maps on my mobile would be more helpful!

      I have a compass app in my cheapo Xiaomi phone. Never used it. LOL!



      AFTER buying that watch only then I realised I've made a wrong decision. What I thought I needed was just "aspirational"...

      To repair, buy a new multi-function trekking watch, or download alternative apps for something I KNEW now I don't need is just falling into the trap of SUNK COST FALLACY...

      Hence, throwing away the watch is the "cheapest" solution :)

      Let it go. Cut-loss. Moving on...

      LOL!

      Delete
    2. The salesman who sold you that $250 "useless" watch must be one heck of a snake-oil. Given that you know all the tricks of the trade, it sure isn't going to be easy to "con" you. LOL.

      Did the same snake-oil sell you the other 3 watches? Haha.

      We all have those moments of aspirational needs which make us vulnerable to snake-oil. Anyway, $250 is not a big price to pay. Your decision to cut loss and move on is a rational one.

      Delete
    3. hyom,

      LOL! I guess some context may help.

      I was in Shanghai and after visiting Hua Shan near Xian, I thought it would be cool to be able to tell the elevation...

      Remember Shanghai has 4 seasons? The temperature can range from minus zero in winter to near 40" C in summer! Silly me thought a thermometer in a watch would be useful...

      Saw a model I liked in Shanghai that's retailing for around SGD $500 equivalent over there.

      So when I chanced upon the same watch that was selling for around $350 plus in Singapore during my home leave back in Singapore, I just walked in and told the salesperson I wanted that watch...

      What follows was horse-trading down the price to $250 ;)

      No selling involved. LOL!


      I can "pretend" that watch would make sense in Shanghai and Greece. But when I returned to Singapore for good, the reasons for buying that watch became even more ridiculous :(

      Delete
    4. hyom,

      This scenario can be applied to not only stocks we owned, but other financial assets that may make sense at one point in time, but when our personal circumstances have changed, we forget to review or let it go...

      Take for example life insurance.

      When we have wife and young children, of course it would make sense to protect their livelihoods in the event we no longer around.

      But when our children are all grown up and earning their own keep, and we trust they will take care of their mother when we go sell salted duck eggs...

      Pray tell what's the point of we continuing our life insurance policies for?


      For singles like me, when our net worth is more than the payouts of our life insurance policies, hello?

      Hence like my watch, I've cancelled all my wholelife and term life policies some years back ;)

      This sunk cost fallacy is something many can parrot in our community...

      But how many will do anything about it?

      Delete
    5. I think it's ok for a person to pamper himself occasionally with purchases that make himself feel good, as long as he can afford it. No need to be rational about why the purchase makes financial sense all the time.

      Here are some reasons that I use to ownself-snakeoil-ownself when I feel like I must buy that thing.

      - Be a good citizen by paying GST.
      - Spending is doing my part to boost the economy. Don't be that selfish scrooge who save save save but expect others to spend spend spend so that one can earn earn earn.
      - Money should serve man and not man serve it.

      The next time something catches your eye, use the reasons above. They are applicable to every purchase. LOL.

      Delete
    6. hyom,

      Yes, there are times when it feels great to just buy because I'm worth it ;)



      Delete
  5. Hi SMOL,

    From astrology, this period until mid July is known as Mercury retrograde. Mercury rules communication and all electronic gadgets, so not surprised that there'll be a lot of failures in that area. I take astrology with a huge pinch of salt, but with regards to mercury retrograding, I take it seriously because it correlates to empirical observation (mine, that is, lol)

    How come never sell your mum the health benefits of cold showers? haha

    ReplyDelete
    Replies
    1. LP,

      When the water heater broke, I did sound out mom whether she is OK with "toughing it out" for the next 5-6 months with cold showers only? You know, we'll move to our new place soon...

      She didn't say anything but gave me that look - I bore you for 10 months, and ingrate me want to deny her hot showers just to save a buck

      I quickly bent the knees. LOL!


      As a semi old fogey myself, I wouldn't take it too kindly if others try to tell me to cut down on my coffee (I drink coffee before going to bed)... Even it were for my own good or with the best of intentions.

      That's why I don't judge or get angry with dad when he goes for his regular escapades to Batam or Bangkok. Look, how many more years does he have?

      The same goes for mom. She is on the heavy side, and can do better to lose some weight... Less pressure on her knees.

      How to approach it without me sounding I'm trying to "starve" her? LOL!

      At work, I'm an Evangelist; in my private life, I'm an Arhat ;)

      I'm definitely don't have any Bodhisattva idealism in my although I'm drawn towards the philosophies of the Northern Transmitted Buddhism path ;)

      Delete
  6. My "watch" went digital decade ahead of Govt's digital incentive for the masses. Ha ha!

    ReplyDelete
    Replies
    1. CW,

      My 3 other watches are old school analogues ones. I'm even more old fogey dinosaur than you!

      You early adopter you!


      The equivalent to my press button got lots of cool functions digital watch today would be iWatch?

      I almost succumbed until I realise today we don't really need a watch; we got mobile remember?

      Come to think of it, I don't wear a watch to tell the time anymore... Its just to look nice and to look less "naked"...

      LOL!

      Delete
  7. Hi SMOL,

    If you buy a watch because of its function, the loss of the function or your need will render the watch useless. So, throwing it away is no pity especially when you are practicing subtraction in your life. 少少益善 . 寡思寡欲.

    The materialistic me would have taken the opportunity to buy a new one, perhaps. During CB, a few of my watches stopped working. Battery died. So last week, I went to my regular watch shop at People's Park to replace the batteries and whined that so many of my watches needed battery replacement.

    Then the shop owner gave me his very wise reply, 'You have easily 30 over watches, these ones don't work you still have many more to wear mah. Some more you say you work from home, you actually don't need to wear a watch!'. Haha. So true. And he knows my watches are meant for matching my outfits. So if I am not going out of the house, why need a watch as an ornament? That set me thinking, should I not ask myself if it is time to wear some other accessories since I don't even look at my watch to check time? The answer is no because I just like watches! But if so, why do I bother to change battery since the watches are merely ornaments?!? LOL.

    Sometimes we are the ones who complicate things for ourselves and all because of our reluctance to let go or think in a logical/pragmatic manner. Just like I got in and out of Ausgroup and Ezra over the past many years. For Ausgroup, it has been a roller coaster of losses and wins all intertwined. Net net, still lost. The financials became quite 'broken' and I sold it to cut loss. Then their finances got 'repaired' and I got in again! LOL. Just that the exposure to the counter is much much smaller than before and it is within the limit I allow myself to hold speculative positions. Are there no better counters to buy? Of course there are but fundamentally, this counter still does hold some promise of recovery (see that is me 'reasoning' again). I did the same for SembCorp Industries. That one I made some money trading the counter since it $4-$5 days. Now still in the counter which I bought during Covid-19 around $1.70+.

    Often we tell ourselves that our decisions are rational, frankly I suspect that we may be deceiving ourselves. We might just be using 'rational' reasoning to justify our emotional responses and actions. At least I know that applies to me sometimes. :)

    ReplyDelete
    Replies
    1. Woman,

      我懂你!

      There's an embarrassing phase when I were in Shanghai...

      I had 8 pairs of glasses. You know, one for each day to match different outfits?

      Its no coincidence my most "naughty" days were also in Shanghai. Wink, wink.

      I better don't share how pairs of shoes I had then... Too "malu"!


      I often laughed when clueless left-brained men gave their girlfriends handbags as presents. Little did they know that's not the end of the story...

      Soon there will be belts, earrings, shoes, and other what not MATCHING accessories that she'll look at them and go, "Oppa!"

      LOL!


      But then again, its good to get it out of my system. Been there; done it. I've moved on.

      I'm a believer in living and experiencing life - none of that let's save sex for when we're old delayed gratification nonsense.

      This probably explains why young people today want to be financially free at 35 than at 65?


      I'm an atheist; I only have one life ;)

      Delete

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