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Home › Articles › Financial Fitness › Home Theater Heist

Home Theater Heist

What to Consider Before Buying a Home Theater System

By Michael Kellam

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Same as Cash?
What makes it worse is that my friend bought his system at one of those electronics stores with the "one year same as cash." How can you beat that – no interest! What he didn't know was that if the balance isn't paid off by the end of the year, that the company charges all of the interest back to the date of the purchase as if it were never "same as cash." To add insult to injury, the credit company charges 29 percent interest on purchases. That means that in addition to the $5,500 my friend paid, he also has to pay $1595 per year interest until it is paid off. If he only pays the minimum payment of $150 per month, it will take him 91 months (seven and a half years) to pay off the system. The total cost of the system is then $13,647 including $8,147 in interest. This means that including the $4 savings per movie, he will have to watch 3412 movies before the system pays for itself. That is a heck of a lot of movies.

If my friend watched a movie every day, it would take him more than nine years for the system to pay for itself. In this case, my friend could have paid full price to watch movies every day at the theater for more than nine years. In fact, the system is not really paying for itself if my friend woul not otherwise have actually paid the $8 every day for nine years to see that many films. It also does not take into consideration that most people see at least some


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