I was talking with my mom on Sunday about her financial situation. We’ve talked about it before and she’s pretty open about things. She was caring for my grandmother 24-7 the past ten years, up until Grandma passed away last September. Grandma had two pensions, one from working for the state for 25 years, and the other for working for the county for 25 years. She had a couple thousand coming in, and the way I always looked at it was a rest home would have taken Grandma’s money, so may as well be my mom getting that money for caring for her around the clock. But now that Grandma’s passed away, her pension no longer arrives every month like clockwork. My mom’s health is not the best and she’s not keen on getting a full time job. In fact, she’s real nervous about the whole idea. I told my mom she should figure out just how much money she’d need to make to just get by. Maybe it would be easier to think about, knowing it could be very part-time job, maybe she’s freaking herself out thinking she’ll have to get out there 40 hours a week, and that won’t be necessary. First off, her house is completely paid for, she managed that when she sold Grandma’s house ten years ago. My mom’s credit is non-existent, so there is little chance she’ll be mortgaging her place anytime soon. No credit card debt because she has no credit. In the end we figured she would need to bring in between $600 and $800 a month to make ends meet.
As she ran down the list of monthly expenses, she mentioned her washing machine. Which she rents. I remember she’d told me about this years ago; today I started wondering how much she paid each month for this used washing machine. I got the chance to talk to her on the way home from work and I asked her who she rented from, and how much. She told me the place, which I’m familiar with. My mom bought me a machine from them years ago, an old Maytag which had to have been 30 years old. It was in great condition and worked well for me for several years. Anyway, she said they charge $18.xx (can’t remember the exact change) each month to rent the machine.
I then asked her, “Haven’t you been renting from them about twenty years?” She confirmed that she had. She asked if I was interested in renting a machine from them. I told her I was just thinking how we’d been talking about whether she could eliminate any of her monthly bills and maybe she could take $200 of her savings (she has right around $6000 – no retirement at all – her husband has nothing either and can’t hold down a job), buy a new machine from Home Depot and then she wouldn’t have that $18/month payment to worry about.
She agreed that sounded like a good idea, but then she said the reason why she prefers to rent her machine is because she doesn’t have to worry when it breaks down. She doesn’t have to worry about her husband wanting to fix it – as he thinks he is a great handyman but well, he actually isn’t.
I told her that a new machine would probably last at LEAST five years without breaking down… but she doesn’t want to think about the possibility of having to worry about the repair issue. She says if her machine breaks down, she calls the rental place and they just bring out another used one. Very simple, and no worry.
At that point she changed the subject, and I didn’t pursue the topic any further.
But now that I’m home, I became curious how much she’s paying for that peace of mind.
Since I can’t remember the change, let’s just say $18/month. There are 12 months in a year, times 20 years, that comes to 240 months multiplied by $18 = $4320.
FOUR THOUSAND THREE HUNDRED AND TWENTY DOLLARS.
Now considering that she’s going to continue renting for at least the next ten years, we can tack on another $2160.
So $6480 for thirty years renting a washing machine.
Well, there’s nothing we can do about the past twenty years, but what about the next ten?
Let’s say she buys a brand new one from Home Depot for $200. There is only my mom and her husband and his uncle, so it’s not like they wash a lot of clothes… so maybe she buys a brand new one from Home Depot every five years so she won’t have to worry about it breaking down. Is that unreasonable? Do you think an inexpensive machine would last less than five years with minimal usage?
Anyway, let’s say it would last five years.
2008 $217.40 ($200 + tax)
2013 $244.57 ($225 + tax)
I added on $25 for inflation for the second one. That’s $461.97. As opposed to the $2160 she’s going to put out to rent a used one.
That is one heck of a lot of money to put out for peace of mind. I mean, it’s only EIGHTEEN DOLLARS a month, and anyone could afford it. But it’s one of those trap things that these places get you into. I am always amazed that people actually use these places. They have them for renting “wheels” for your car, computers, or an entire houseful of furniture. OH! It just makes my head spin to think about it.
Have you ever fallen into the rental trap?