A luxury watch is a big purchase. In addition to being more costly, they are also fewer in quantity and considered special items. For example, true luxury watches are authenticated by experts before going into retail, meaning they may come with a certificate that proves their worth.
Whether you’re in the market for a new watch or have recently purchased one, it’s crucial to take certain steps to make sure you’re getting the most out of this luxury good and protecting it for the future. Here are some steps to take when buying a luxury watch:
Research Luxury Watch Brands
Always know exactly what you’re purchasing, especially when shopping online. It’s been projected that the online jewelry and watch sales market size will reach $7.6 billion in the U.S. alone during 2021, so it’s more important than ever to stay savvy and only go with reliable brands. If purchasing from a non-established retailer or a third-party one (as in, anywhere that isn’t the brand’s store itself or one of their approved retailers), always ask for proof of authentication. It’s also a good idea to research the retailer itself and make sure they are well-established with years of positive reviews and transactions. Keep in mind that if a deal appears too good to be true, it probably is.
Even if you’ve already purchased your luxury watch, researching the brand behind it is a good idea. This will help you recognize its true worth as well as the unique history behind it. This will be important information to have should you ever decide to sell it to a different owner or give it away as a gift. And of course, sometimes it’s just fun to become more immersed in the brand you’ve decided to go with. For example, an interesting about Rolex is that they don’t ever give away watches to anyone — even well-known celebrities have to pay for the Rolex watches they wear.
Consider Additional Costs
The face-value cost of your luxury watch will likely not be the only cost associated with it. The main cost here will be state and local taxes. In the state of Florida, for example, sales tax on all items is 6%. So, if you purchased an Alexandre Meerson watch in Florida for $18,000, you will also have to pay $1,080 in sales tax.
If your watch was given to you by an employer or client, it may also be considered a form of compensation you will be expected to pay taxes on. Likewise, any special storage or insurance costs will also be on top of your initial buying price. It’s important to consider these costs ahead of time and budget for them appropriately.
Protect Your Purchase
As with all expensive purchases, it’s a good idea to take steps to protect your investment. Depending on the price of the luxury watch, you may want to make sure it’s covered under an insurance policy. It’s also imperative that you store it in a safe space (whenever you’re not wearing it, of course) and take care to protect it from damage. Many luxury watches come in their own unique box or velvet bag, which a lot of owners decide to hang on to for actual storage purposes. If you have a safe at home, you may also want to store the watch inside when you’re not using it.
If your watch comes with a certificate of authenticity, you will want to hold on to that in case you decide to sell it later on or want to pass it down to someone.
Update Your Estate Plan
Yes, believe it or not, your luxury watch purchase should be an indicator that it’s time to update your estate plan. Items like luxury watches often don’t come to mind when people are writing their wills and forming estate plans. In fact, an estimated 55% of Americans die without any valid will or estate plan. As a result, surviving loved ones often argue over who is entitled to which item, not to mention how much the items are actually worth.
Whether or not you’re sure right now of what you want to happen with items like your luxury watch when you pass, it’s a good idea to at least reach out to a qualified estate planner or attorney for a consultation. They’ll be able to help walk you through the process and consider your options.