Costs vs benefits

I usually have no idea what to write about, and most often, it is a discussion or article from someone else which I end up enjoying and wanting to discuss further. No different this time of course… reading an article on AOM about the cost of a thing… very interesting indeed, when it comes to watches and ownership.

What is the cost of an item? The price tag is a matter of fact, but how often do people really think about the true cost of an item when weighing it against the benefits of ownership? Aside from the upfront purchase cost, there are basic considerations such as the cost of future repair, potentially insurance, and even the ongoing finance costs if you borrow money for the purchase.

So far, this is not new information to anyone; a car will need fuel (or electricity to charge it), servicing, along with the odd unforeseen expense like a tyre change or windscreen replacement. A watch will need to be serviced, insured, stored safely and these costs over time will rise with the value of the watches you buy.

What is interesting is that to obtain the money to buy these items, you typically trade your effort or ‘work’ – and ultimately you’re trading your time, to do this work. I guess this is a long winded-way of saying “time is money”.

To go deeper still, the time you trade is very finite, and you could have chosen to spend it on your personal hobbies, with your family, or with your children. To add to this, let’s not forget that for most people the time which spent working is not based on a personal choice but rather, it is time which we are obligated to spend working (or risk being fired). So the truth is, you trade some of your autonomy when you are working (more so when working for others). 

To top it all off, how does the purchase affect your MIND? I used to collect sneakers and a mental ‘cost’ of doing so, was the sheer volume of space it occupied over time… which led to the debates with the other half about clutter and so on. Going on holiday was also scary for me because of the worry that a fire could burn my whole collection instantly! The same goes for watches too – the worry nowadays when you wear an expensive watch is significant, and the risk is growing constantly. Just over a year ago, an Omani student was killed outside Harrods in London – just for his watch! This means, buying a nice watch could ‘cost’ you some of your “peace of mind” too.

The following quote by Henry David Thoreau sums it up perfectly:

the cost of a thing is the amount of what I will call life which is required to be exchanged for it, immediately or in the long run

My goal here is simply to offer some food for thought regarding purchase decisions. Try not to focus only on the ‘here and now’ when it comes to the purchase – think beyond the price. Equally, evaluate the benefits in a similar way… will you feel as good or satisfied when you buy that <insert amazing value for money brand, which is less hyped> item even though <insert more expensive but less ‘value’ brand> is what you dreamed about as a kid? I don’t advocate buying things for other people to see, but we are all human, and sometimes we are open to being influenced by external factors – this is evident in the fact that “hype” exists at all… so if it will make you happy, that is worth something, even though it is intangible.

So in summary… If you are evaluating whether a purchase is worth it, or whether you’re getting a “good deal” on something, the question to ask is: Will buying this thing offer more life than it costs me to obtain it?

How do you approach purchase decisions? Let me know below!

-F

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