Camera Depreciation And How To Avoid Losing Money
In today’s fast world, camera tech changes rapidly, we all know that by now. And it can be frustrating watching a camera’s value diminish seemingly overnight.
It’s a harsh reality check when you first realize that you’re going to have to sell it in a few years, not even reap half of the money you originally paid, throw in free accessories to get the sale, and then go buy the current hot camera and restart this whole stressful race to pay it off again.
A lot of us in this industry have gotten used to the fact that this is going to be an ongoing expense you have to make room for.
For those of you out there that are new to this or just curious about other options that could save you some serious money with depreciation…
Then check out these suggestions!
Buy cameras that offer upgrade pathways
Higher end digital camera companies like RED and Arri are aware of how quickly they come out with new innovative camera tech every year or two. Knowing full well that it’s hard to pay off the camera and gain some profit in that short time period when you have bills to pay, RED decided to cut they’re loyal consumers a break and offer unique upgrade pathways that revolve around their brain design.
This way you can keep up with the next best thing and not break the bank while doing so. What’s more, most accessories you buy are still compatible. Be sure to call a representative and talk about those upgrade options before purchasing a particular model.
Arri offer’s some upgrades with their Amira cameras and I’m assuming when Arri’s new S35 4K Alexa mini drops, people with the Alexa mini classic might have an upgrade pathway available to them.
Sell them while they’re still hot
Accepting the fact that you’ll eventually have to part ways with a creative tool you’ve become so accustomed to is not always an easy thing to do. If you have no attachment issues when it comes to cameras, then this option will suit you well. Another way to avoid depreciation is to outrun it.
Sell the camera while it’s still a hot item in the market and keep a close eye on that sale price and rumors about other new cameras coming out. Get some quick use out of it for a year or so, then move on to a popular competitor. Stay ahead of the curve and don’t spend too much time with any one brand or model.
Buy Niche Cameras
When buying anything ‘brand new’ it’s best to invest in something unique. There’s always a better chance that it’s price tag will stay relatively the same. The same goes for camera investments.
With digital cameras, there’s a lot of companies looking to copy each other. But some companies are making sure they create special commodities. Brands like Vision Research and their Phantom Flex 4K high speed camera system are one of a kind with their ability to shoot 1000 frames per second in 4K resolution. The Phantom’s price tag has actually gone up over the years, breaking the typical rules when it comes to depreciation. It cost close to 100K when it first came out, now you can find price tags online for over 100K to purchase. That’s crazy! But also good news to those who took that steep dive and bought this gem when it was first released.
Other niche cameras that hold their value are film cameras (90’s +) and the accessories associated with them. They typically have a slower depreciation rate than digital cameras due to the fact that there isn’t as much competition and the equipment’s robust design lasts for decades.
Renting cameras will definitely save you money up front by getting you the camera you need without paying the hefty price tag. This will seem like the better option when starting out and getting your bearings. The more your career flourishes and you become cemented in the industry, the more you’re actually going to be losing money over time.
When you purchase a camera, you get to charge a camera package fee that can range anywhere from $500 to $3000 (depending on the purchase) on top of your daily rate. You split that up any way you want, but make sure at least half of that package fee goes toward paying off the camera, if not all of it. You should pay it off sooner than later. Make the biggest monthly payments you can afford because once you pay it off, it’s pure profit after that.
When you rent, that camera package fee goes into the rental house/owner’s pocket and it’s likely that the camera has been paid off for quite some time.
Hustle up and get your money’s worth out of it
One way to make depreciation a non-issue is to get out there and work your ass off! If you’re getting multiple gigs a week and you’re doing your job well, you’re going to have that camera paid off before depreciation takes effect. If you’re saving large amounts of money and you have that reserved for new camera purchases, you’re gonna be able to sell when you want and a little depreciation is going to be something you can afford.
So get out there and network more, build more relationships, perfect your craft and find yourself more work!
Tax Write Offs
Check out this blog that references gear depreciation and explains a bit more in depth how you can write off 20% for 5 years.
Don’t rush it!
When traversing the savage land of cameras and hunting for something you can sink your teeth into, remember to take your time. Don’t purchase something as expensive as cinema cameras on a whim. Make sure your finances are in order and you have a back-up plan to make those monthly payments. When you’re a freelancer, you never know when you’re gonna have a slow month or season, so don’t throw too much caution to the wind.