Trying To Save Money? Why Spend More On Gadgets?

From iphones to home entertainment systems, it seems we are a nation obsessed with gadgets and are willing to spend on the newest and best regardless of our personal finance situation.

According to research by swiftcover.com, some avid collectors have bought some 21 gadgets in the last 5 years and on average each person has bought six.

There is more and more pressure, through such as strong advertising and peer pressure, to update gadgets frequently. Some even need to be updated every 6 months as they are superseded by new models.

Around a third of gadgets bought in the last 5 years are no longer in use by their original owner. Many have been ‘lost’, some thrown in the bin, some recycled and a few resold to recoup costs or help to purchase a new item.

Equally a third of those who bought gadgets in this period assumed that their home contents insurance covered them and another third didn’t insure them at all.

As James Barclay, home insurance manager at swiftcover.com, said: “Having the right insurance in place is essential otherwise the risk of losing thousands of pounds worth of gadgets and their content is very real.”

MoneyHighStreet comments: “How apt this research is. It shows how keen everyone is to have the latest ‘toy’ and yet at the same time for many their financial situation doesn’t support continued expenditure.

“A quick poll around the office shows we have several smartphones, including iPhones, a Samsung Galaxy and a variety of HTC models. There’s an iPad, MP3 players and Kindles all in full view in the office and that’s not even touching on purchases sitting at home.

“It goes without saying that if you are going to buy any of these items, make sure you can afford them and are not risking taking on debt that you can’t pay off.

“Critically also make sure you buy a gadget that meets your needs and get the best deal. For example there is no point getting a Kindle that only works on Wi-Fi if you are going to want to download new books when not in a Wi-Fi area. In this situation you’d be better off getting the 3G Kindle model – see our Kindle review for more on this point.

“As far as insurance is concerned, you of course need to make your own decision on whether to take out cover. You also need to consider whether you rely on your home contents insurance and if so check that there is enough cover provided. For example the swiftcover product includes £500 cover for digital assets such as MP3s or films stored on a computer or digital media player, alongside competitive cover for gadgets and home entertainment systems. Other policies will differ.

“Opting for this route means that if you do need to make a claim, you could affect your no claims bonus and incur increased premiums at renewal as a result.

“An alternative option is to take out separate cover, for you smartphone for example. Of course there is an additional cost to do this but you need to weigh this up against the risk of claiming on your all embracing home contents policy.”