Buy What You’ll Use, Use What You Buy
A reflection on the value and meaning of money during the season of giving … hmmm. Maybe rewatch It’s a Wonderful Life. I can speak to the lagging effects of consumerism, now that Christmas presents have been opened.
As news outlets continue to speculate about a recession, which is after all a normal part of the business cycle, economists have pointed out something else … consumer spending hasn’t slowed down. Meaning either we aren’t concerned about a recession and remain confident in our ability to weather future hardship, or … we just don’t care and are livin’ for the now.
Yet other reports talk about most people’s inability to handle an emergency, living paycheck to paycheck, not saving for retirement or anything else.
We just need to buy what we’ll use, and use what we buy.
Which has nothing to do with “budgeting” or “being cheap” but everything to do with intention. Budgeting is about making sure you earn more than you spend. Intention is harder, because the whole marketplace makes it easy to buy. And buying feels great.
In the book, and in talks I’ve done since, I identify four behavioral pathways to financial wellness. I observed thousands of case studies with clients over the years, and realized there isn’t one way to be. We have to do what feels true to our personalities. Regardless of income, we need to employ at least one pathway very well, maybe two. I have yet to meet anyone that does all four, although sometimes couples can cover three combined.
My parents exemplify the “buy what you’ll use and use what you buy” pathway very well. It’s not my primary pathway, but any success I have here comes from their influence. (Shoutout to my grandparents’ dresser still in operation, pg. 338)
Enter Exhibit A: a winter coat from Old Navy, purchased for about $100 when I was 16. It has a Discman pocket (Google it, Gen Z). You can fit a hardcover Harry Potter book in this pocket.
I thought it was fashionable only for a few years, maybe less. In the last 20 years, it has served as my primary coat to take the dog out, the coat I smoke cigars in, and the coat for the occasional dirty outdoor job. For these three scenarios, I would expect the coat to last another 20 years.
If I invested $100 that I saved by not replacing the coat, using the Rule of 72, I’d likely have $400 by now. Left alone another 20 years it would be $1,600, give or take. All saving is just deferred spending. Or deferred giving when you pass away.
Exhibit B is a computer bag from REI that I got when I was 23 … my old boss from 10 years ago recognized it when we caught up recently. Alas, it’s finally ripping right at the base of the strap. Meaning if I continue, it will tear off right as I’m boarding an airplane or something.
I use this bag a lot. It’s too heavy duty for Rebeca to sew at home. It’s too inexpensive of an object to support a local shop repairing things like this. I got my money’s worth for sure, but I don’t want a new bag for $100, I want this bag.
All purchases, except land, businesses (including stocks), and collectibles depreciate and lose resale value immediately. On the other hand, experiences appreciate. I want to keep the bag, and the coat, because they remind me of experiences.
So the question isn’t “can I afford it” but how much will I use it or love it. Spend big if you’ll use and love it. But more isn’t always better.
Some of the best parenting advice I ever read was to remove the majority of toys and rotate them in, increasing novelty and reducing choices for play. Too much stuff overwhelms children. And adults.
So for 2024, remember that our happiness largely depends on the story we tell ourselves. We want our actions to align with our values. But we can’t be all things to all people. Or buy everything. So buy what you’ll use, and use what you buy. Your account balance, and the Earth, will thank you