Buy now, or wait for the new version?

She's got all the answers.

I just bought a Motorola Droid X phone, and I know something better will come along in a few weeks, if it's not already out there.

And folks who got an iPad for Christmas are probably wishing they had waited.

So I noticed the Best Buy ad saying the company will sell you that gadget you just have to have and then buy it back when the newer version comes along.

What's the catch?

Joshua Gans, an economics professor at Melbourne Business School and a visiting researcher at Microsoft Research, writes in a Harvard Business Review blog (you wanted my opinion?):

Here's how it works. If you pay $59.99 to Best Buy, you can make sure that you get a certain amount back if you want to upgrade your iPhone later. For instance, if you want to buy in a year's time, Best Buy will pay you 40% of the price of your old phone. Let's do some math. Pay $299 originally and you get around $120 back. So if the new model costs the same amount, then you will effectively pay $180 to upgrade (I'm ignoring sales tax here). Of course, you actually paid $359 originally so the automatic upgrade price is really $240 but perhaps you feel better about it at the time or in explaining the credit card bills to your spouse.

It took me a minute to parse that. You have to figure that the first $59.99 reflected a contract commitment, and the $240 you'd pay for the new phone doesn't give you the contract commitment deal.

But that's not even the real issue.

The choice is not between paying Best Buy more, twice, or paying them slightly less. You could do what I did last year. I put my old iPhone on eBay. That cost me a little time but it netted me much more than 40% of the phone's purchase price. Indeed, in my case, I received 100% of that price because the phone was free of a contract. For items in good condition, eBay really allows you to do well on the second-hand market. Forecast that and you can see that Best Buy is costing you a fortune.

He goes through a lot more stuff only an economist could love, and you're welcome to read it, but I think we all see why we just buy something impulsively, as I did. You can't have your own personal economist following you around in Best Buy, or Costco, where I bought my phone.

And as Gans sums up: For doubters out there considering whether you should get yourself an iPhone now or wait, here is my simple statement that I have used to sell a ton of iPhones: "No one is going to be sitting on their death bed saying, "'I wish I had waited to buy an iPhone.'"