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Home › Articles › Grandparent Finance › Home Theater Heist

Home Theater Heist

What to Consider Before Buying a Home Theater System

By Michael Kellam

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Have you ever thought that a particular purchase would save you money? I often hear people talk about how they can save money by purchasing something that will save them in other ways. A good example of this is a home theater system.

Many of my movie buff friends, awed by snazzy displays in electronics stores, have convinced themselves that there is no cost in this type of purchase. After all, it is difficult to find a first-run movie theater that sells tickets for less than $6.50 each, and many are substantially more. Surely, they reason, at say $8 per ticket, they would save money purchasing this system that attempts to approximate the theater experience. But is this really the case?

Saving Money?
One particular friend purchased his system in stages. First he purchased the large-screen television for a cost of around $2,000. Then he purchased a mid-range stereo system including a DVD player for another $2,000. For these prices, surely the stereo would include speakers, but, says my friend, that is not the case. He spent another $1,500 purchasing speakers and a sub woofer because he likes the bass. My friend was telling me how he got a great deal because he purchased several of the components at once. He asserted that he "saved" several hundred dollars on the equipment and that the entire system would pay for itself since he would no longer incur the cost of seeing theatrical releases.

Considering his assertions, my curiosity got the best of me, and I began crunching numbers. I added his equipment costs and figured that his system cost $5,500. At $8 per movie, that means he would have to watch 688 films on his home theater before it would pay for itself. Not bad, you might think. He might see that many films in two years if he watched one every day. Of course, this assumes he is watching films that he would have seen in the theater but chose to view them on his home theater instead or else he wouldn't be saving money. My friend found that even with his home theater, he did not want to give up theatrical movies all together, so maybe it would take a little bit longer for the system to pay for itself.


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