I felt compelled to write about this topic after reading a comment by Garvey on Is A Deep Freezer Worth It?:
There is no way a freezer costs $10-15/month … to run. It’s more like $3-4.
This was in response to my statement that the cost of owning and maintaining the deep freeze is about $130 per year, or about $11 a month. I came up with that figure by calculating both the electricity use of the freezer ($75/year) as well as prorating the cost of the freezer ($450/8 years, or $56/year). Add those together, and you end up with that $11 a month figure for the cost of owning and operating the freezer.
You can do similar figures on nearly any appliance or device in your home. Our television is on its last legs (bright blue spots are appearing on the screen and starting to obscure things). We bought it for only $150 six years ago, which we use for 2 hours a day, actually costs us about $9 a year in electricity. So, we pay $0.75 a month in electricity, but we’re also spending $2.08 per month for the actual cost of the television, bringing our monthly bill just to have that television in our home up to $2.83 a month.
Some will undoubtedly state that this isn’t a fair way to look at the cost of things, because once you’ve paid for the item, the cost of the prorated usage is basically free. I actually feel that’s a terrible way to look at it, because it makes the appliance cost appear as “special” costs that will make you hit the credit card or tap the emergency fund when an appliance goes out, and it also creates some skewed calculations when buying an item.
Let’s take a look at washing machines, for example. If you look at the Consumer Reports recommended appliance, the Whirlpool Duet HT GHW9400P, you’ll regularly find it in stores for $1,400. On the other hand, you can buy a low-end toploader for $200. What are you getting for that difference? The Whirlpool Duet uses less energy per wash (about 1 kWh for an average wash, versus 1.9 for a low end toploader), handles larger loads (about 4 loads in the Whirlpool versus 5 loads in the low end toploader), and will have a significantly longer life (14 years is the estimate, versus 6 for the cheap toploader). If you do, say, 20 loads a month in the toploader, you’ll be doing 16 a month in the Whirlpool. That gives a monthly energy use of 38 kWh for the toploader ($3.80) versus 16 kWh for the Whirlpool ($1.60). The Whirlpool’s cost per month of the appliance itself is $8.33, versus the cheap washer’s $2.78. This means that the cost per month of the cheap toploader is $6.58, while the cost per month for the Whirlpool is $9.93. This does not include detergent and water savings with the Whirlpool, which are pretty small ($0.50 a month or so). If you’re a heavy laundry user, those numbers get closer and closer together, so for a family with multiple children, the Whirlpool gets closer and closer to the toploader in terms of cost.
Now, the question when you do such a comparison is is that extra cost each month worth it? With the Whirlpool, you’re buying reliability (it will have fewer repair issues and won’t have to be hauled out of the laundry room as often), somewhat better cleaning, and aesthetics (they are more stylish than the cheap toploader). Is this worth $3 a month for 14 years to you? There’s no immediate answer, but for me, the reliability makes it worth it.
What’s the point? You don’t often seen the true cost of an appliance until you look at the cost of owning it per month that you’ll use it. Many people look solely at the up-front cost of an item, then when it’s purchased and paid for they forget about it until a replacement is needed. A better approach is to at least be aware how much these items are really costing you each month and recognize that when you bought the item, you effectively “pre-paid” for those months of use of the item. It’s a great way to comparison shop and it often makes more expensive but reliable and energy-efficient items look like a much closer deal than you might initially think (because they are).