Before buying anything online, I would still suggest at least going to a bike shop, talking to the experts, and testing several to get properly fitted and to just find what you like.
That said, my boyfriend bought a great frame and all of his components online-a mix of new and used (ebay and craigslist)-and put it together. He ended up saving about $500. But, he also knew exactly what he was looking for and has been riding for years. I bought my current bike used (craigslist), upgraded some of the components, and saved a lot as well. But, again, I knew what I wanted and had the help of someone who knows a lot about bikes.
I also think it's a good idea to develop a relationship with a bike shop in your area. Since you're just getting started with cycling, you'll probably need help/advice with tuning and maintaining your bike. Having someone that you trust and who knows your cycling style/needs is important.
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