Posted 8/6/2022 10:05 (#9783061 - in reply to #9782852) Subject: RE: Having a very hard time wrapping my head around machinery prices
Easy, you are missing 1 important component of combine ownership, inflation or deflation, whenever it happens to be at the time. For instance the guy with a 10 yr old combine pd close to 300000 as a example when new, now that combine is 600000. So when he parks his used one at the end of the lane for free in your example he no longer can go out and pay 300000 for a new one to replace it. He really has a hidden 30000 cost per yr that his used one did not keep up with inflation. So the guy that trades every year has kept up with inflation and has a 600000 combine in his shed, not a free one as in your example. This is a paper exercise only as market rises and falls during that 10 yrs and there will be buys sometime in the that 10 yrs as market changes but for a guy that has some serious use every year and can put 300-350 sep hrs on a year, he has to have a some kind of program that works year in and year out.
Everybody has different needs and different timelines and different priorities. By far cheapest route is save up your money during good times, buy when no one else has money, and wait for next bottom in economy to update. I try to use that strategy as much as I can but doesn’t always work for everything and have to do some business every year to keep timely ness and manage taxes etc.