Friday, October 30, 2015

Spending More to Save Some -- Analysis of Purchases

Followers of this blog will remember that recently our home was granted an historic status, which opens the door to federal tax credits for certain upkeep and repairs -- exterior items primarily.  When the federal government will give us a 25% discount, our frugal eyes zoom into the details.  And as we dig in, the appeal of the program is beginning to face.  Why?  It seems that we have to spend more than we really need to in order to save.

Furnaces and A/C replacement are included, but the quote for a new furnace was far below what we braced ourselves for.  Knowing about the federal program, the sales person started adding suggestions about how we can climb to that magic number of $10K minimum to apply for the grants. Discussing what he told me with my husband we realized -- we are talking about replacing an A/C that still works, and we live in Wisconsin, a place where if an A/C breaks life goes on relatively undisturbed.  And the chipping away at the purchases covered by the program continues.  Why are we spending money to save money?  Yes, these are all items we want to address, but do we need to do them immediately?  Why not wait until the life has been extracted from the furnace, the A/C, and the exterior paint?

So, what seemed to be a very attractive program is fading in our eyes.  We may still use it, but not until we "run the numbers", factoring into our analysis depreciation.  A furnace will likely have 30 years in it, depreciating slowly.  I am not sure that will hold true for the outside painting.  The quote will come in later today, and I anticipate it being quite high.  And I was not pleased when I asked how long the work would last and was told "it depends on what is underneath -- the more paint build up, the more frequent the need to paint, but likely 5 to 7 years."

We'll be creating a spreadsheet to capture all the number, etc.  We are a frugal lawyer and frugal engineer - a nightmare for any salesperson who has to do business with us.  And that is all for today from our frugal corner of the world.

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