How to Avoid Getting Cut by the Cutting Edge

When I graduated from college in 2002, smartphones were just beginning to become popular. There were several different types floating around out there, most with LCD screens that enabled you to check your email and send text messages, both of which were beyond the capacity of the “dumb” phones at the time.

I immediately got a job in a research lab that involved managing lots of data and organizing it for sharing and distribution. From an intellectual standpoint, it was a wonderful job and it paid quite well – my starting salary was more than what my father was making, and my father had reached a pretty stable point late in his career.

It wasn’t long before I joined up with a group of young professionals who all graduated within a few years of myself, all of whom found technology-related jobs in the same city. We started going out together sometimes after work, particularly starting in the fall of 2003.

While there were some big positives from those years, including a lot of camaraderie and some great sharing of resources and ideas, there was one big problem. The group had a huge amount of oneupmanship.

There seemed to constantly be a contest of sorts that compared how people dressed (a contest that I usually didn’t win, honestly), what car people drove, what restaurants people had been to, and, by mid-2004, what smartphone they were holding in their pocket.

Most of the people gravitated quickly to various BlackBerry models. Several people in the group started off with the older LCD models of BlackBerrys, but with each little technological improvement or new feature, someone picked up the latest model. It quickly turned into an arms race of sorts. Someone got a color BlackBerry. Someone got one with a better form factor. Someone else got one with a much better color screen. And so on. And so on. And so on.

There was always lots of talk about how “productive” these phones made people, but the truth often was that such talk was overblown. Much as with today, the truly useful features of these phones were features found in other, much cheaper phones.

Sometimes, the phone would have some great new feature, but that feature either wouldn’t amount to anything genuinely productive or it would be so buggy as to be useless and wouldn’t work well until a phone update in the future.

Anyway, the end result was that there was a lot of motivation to buy the absolute latest smartphone right when it came out, so that I could have the “latest” device. And, at least twice, I managed to do just that. I picked up two different smartphone models on the day they hit – one was a BlackBerry and one was a Palm model.

On those days, and for the next few days, I got a lot of attention for that model, and that was certainly fun, but it didn’t take long for someone else to have something “better” and for the newness to wear off.

What came next? Honestly, I didn’t wind up doing much of anything with those devices that I could not have done with less expensive phones. The “hot new” features were either irrelevant or really buggy. The web browsing capacity was basically unusable on those phones, though it was often lauded and bragged about. Sending emails on those phones was drudgery. In all honesty, I basically wound up doing just the most obvious things with it – sending texts and making phone calls. It was an overpriced “dumb phone” with a few gee-whiz features I used once a month or so.

I should have expected that, because there’s one fundamental truth I’ve learned about buying new technology. You can call it “Trent’s Law of Tech Spending,” if you’d like:

The first release of a new technology device is almost always flawed, and the update to fix that flaw won’t come for at least a few months.

Almost every device you can think of had an ignoble first release. It wasn’t until the second or third version of the item that the device really became useful. Almost every technology innovation I can think of had this kind of cycle. The first version was cool, and you could see the potential, but there were big flaws that hindered the usefulness at first.

I played with the original iPhone, for example. It was very cool… but it couldn’t do much. The potential was there, but it was really yet to come.

There’s an extension to “Trent’s Law of Tech Spending,” too:

The first time a new feature pops up in a device, it won’t work nearly as well as you think.

Why? Because features are almost always sold on potential, not on reality. The ads show you a perfect test case for the feature, but when you actually use it in the real world, it doesn’t work like that. It might eventually work like that, but that won’t happen until a later update or a later version.

What makes all of this even more challenging is that the first release of a new device or a new feature is usually really expensive. Second and third generation versions of the same item often combine a price decline along with better and more useable features.

So, let’s roll forward to today. I own a smartphone that’s about three generations “old,” yet it does everything I want it to do and never has any trouble. I have a Kindle that’s… five (?) generations old, yet it does everything I want it to do and never has any trouble. The same thing goes for my tablet.

None of those items were bought as the first version of that product. All of them are third generation or later. None of them were bought anywhere near the day of release. Instead, I waited for patches and fixes to be released before I bought in. Because I waited, I paid significantly less for those items than I would have otherwise.

The best part? I don’t feel like I’ve missed out on a single thing because of this approach. I’m sure if I hunted around I could find a minor feature or two that I would find useful, but the reality is that I don’t miss any of that stuff in my day-to-day life.

The tech items I have work well and do what I need them to do. They’re stable and reliable (as much as such devices can be) and I paid a reasonably low price for them.

I don’t tend to own the hottest new thing any more. Instead, I wait around for it to mature a bit so that the prices drop and it becomes clear which features actually work well and which ones are actually useful and robust. That’s the basis I use for purchasing decisions.

The only thing I missed in this entire process is the feeling of being on the “cutting edge.” I don’t really get to be the guy with the “hot new gadget” any more.

The interesting part about that? I don’t really care. I don’t care what most people think of me on a day-to-day basis. No one that I care about is going to be really impressed by the fact that I have the hottest new gadget. It’s not going to win friends. It’s not going to build better social connections. It’s not going to make the friends I already have like me or respect me more.

It’s just going to be a device that I use for my own needs, and having the latest and greatest device usually just backfires on me in a number of ways.

The next time you’re thinking about spending your hard-earned money on the hottest tech device, keep a few things in mind:

  • It won’t win you any friends or make people impressed with you.
  • The features you see are largely duplicated by something else that costs a lot less.
  • The “new” features are often first-generation ones, which means they’re likely to be buggy and won’t work well until a later update.
  • It’s going to also come with that “new” item price premium, which means you’ll spend more now for something that will go down in price in the near future.

In short, being on the cutting edge is rarely worth it. Leave that to the people who write about technology (and usually receive review copies of the products for free). Instead, wait until it matures a little bit and the price comes down. Not only will you skip over many of the flaws of that first generation, you’ll also save money by doing so.

Trent Hamm

Founder & Columnist

Trent Hamm founded The Simple Dollar in 2006 and still writes a daily column on personal finance. He’s the author of three books published by Simon & Schuster and Financial Times Press, has contributed to Business Insider, US News & World Report, Yahoo Finance, and Lifehacker, and his financial advice has been featured in The New York Times, TIME, Forbes, The Guardian, and elsewhere.