The Cost of the Psychology of New

My wife and I are actively in the process of purchasing a replacement for the car my wife uses for her commute. During our initial search, we focused pretty tightly on late model used options, but as we searched, we began to find that, for many of the models we were looking at, the new models were so heavily discounted and incentive-laden that they were only slightly more expensive ($1,000 to $2,000 more) than the same 2005 or 2006 model. Thus, we’ve begun to include the new models in our search. (For those interested, we’re mostly looking at a Toyota Camry – boring, I know, but it has the features we want.)

A month ago, when I would talk to friends about our car purchase and our intent to buy a late model used, they mostly reacted with indifference. However, when I began to mention that we were considering a new car as a potential option, their tunes rapidly changed. “Really? You’ll have to stop by and show it to us!” was a common refrain from people.

This actually brought back a lot of memories of my gadget-buying days. Whenever I’d get something new and nifty, I would be compelled to go around and show it off to people. I’d stop by and visit several friends, mostly just to show off my new gadget, and I’d often wind up involved in social events that I wouldn’t otherwise participate in. Thus, on top of the bill for that new gadget, I’d also have a few dinner bills, a refill of my gas tank, and some extra miles on my odometer.

We all have a natural tendency to want to be admired. The interest that others show in us when we have something new to show off is pretty compelling. People look at us with some degree of envy and, on some level, we enjoy that. I know I certainly do.

The key, though, is to recognize that such attention is very fleeting – and it has a surprisingly expensive cost. If I were to be convinced to buy new just because of my desire for a taste of adulation, I’d get a bit of fawning from several friends for a few days and then it would die off to the occasional question about the car. For that, I’d pay quite a bit (aside from the additional cost of buying new right now, which is an entirely separate debate): a higher insurance rate, a tank of gas and some miles going around visiting friends just to show off the car, some miles on the odometer, and a move ever closer to an oil change and other maintenance needs.

As for my wife and I and our car purchase? We’re still shopping and negotiating, but we’re being quite cognizant of the influence that the psychology of new can have. Thus, we’re focusing entirely on what will get us the most years of reliable automobile use for the dollar, regardless of whether it’s new or used.