Think in terms of value rather than numbers.

A couple weeks ago Seth Godin posted this piece to his blog about how we think about spending money. In it he suggests rather than thinking in terms of numbers, which can quickly get abstract, we think in terms of value. It all boils down to asking yourself: what else could that money go to?

For instance right now I would really love to get a playstation 3 so that I could play Assassins Creed 2 and 3 (it just doesn’t work right on a PC). I have the money to do it. I could run out today and grab it and the game for $300 and not have it bust the budget for bills or anything like that. Thinking in terms of numbers makes the mental equation a dream vs a number. In this case the equation is:

Playstation 3 and all the fun I would have playing games = $300

This to me is a no brainer, and if this is as far as I think, I am running out to Target today to get it. If however I think in terms of dream vs dream, I start to think about what else could be done with the money. The equation changes quite a bit.

For some people the temptation is to think in terms just serious stuff like investing. That $300 in an index fund that earns an estimated 9% will wind up as $3980.30 in 30 years. I suppose if you are exceptionally miserly that investment would be attractive to you, but from my perspective, life is for living. As much as I believe in investing, we all need to have fun, and comparing something fun and entertaining with investments is an unfair comparison. In this case I am still running out to grab the playstation.

If however I think in terms of entertainment value, the very first thing that comes to mind is four season passes for the family to Six Flags. I live about 40 minutes from Great Adventure and could conceivable go there dozens of times between May and October and build really great memories with the kids. No matter how much fun playing a video game is, I would not really call it a great memory.Now the equation is

Playstation 3 and all the fun I would have playing games = Passes to Great Adventure and all the fun and great memories that my family would have.

Suddenly the equation is not leaning in favor of the playstation.

Now, lets take it a step further than Seth did in his piece and bring time into the equation.

The playstation will be used primarily when the kids are asleep or in daycare – times when I am working on the blog, my courses, and generally handling business. While the immediate gratification I get from playing a video game is greater than writing itself, the overall satisfaction of finishing a project that sells and which contributes to the art that I have dedicated my life to is WAY greater than the Playstation game experience.

The season passes will be used at times that I am with the kids anyway, and have to be doing something to entertain them.

So now the equation is:

Playstation 3 and all the fun I would have playing games despite lost productivity

vs

Season Passes to Great Adventure, all the fun and lasting memories I would have with family, and no lost productivity.

So needless to say, I am not getting a play station today… At least not until October when Assassins Creed comes out and my FOMO absolutely tosses that equation out the fucking window :-)

 

 

About Inominandum

Author. Sorcerer. Consultant. I have 30 plus years of experience making magic a reality for myself, my clients, and my students. For a complete background go to www.strategicsorcery.net
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17 Responses to Think in terms of value rather than numbers.

  1. Abobymous says:

    Hey Jason,

    What’s a FOMO?

    Abob.

  2. Inominandum says:

    Fear Of Missing Out. In many cases sales and advertising is driven no so much by need or value, but by FOMO.

    • Abobymous says:

      Oh man, I hear that. Actually, we got rid of cable TV in the house and just use Netflix now; on the one hand, it becomes really clear how there are these currents in society that influence people that have entirely to do with ads, but on the other hand, as I was saying to my partner the other day, we don’t even know what we’re missing out on any more :)

  3. LucidDream69 says:

    Good post. Have been thinking about stuff like this, too.
    instant gratification vs. longterm fulfilment of dreams. thank you, this really fits into my process :)

  4. I really enjoyed this post. Handy bits of perspective and thought processes such as these are pure gold for my daily. I actually think this way a lot of the time but I’ve had a hard time explaining it to people. Well done sir!

  5. Zorku says:

    They both seemed fine for me on PC. I tend to prefer playing things on a PC though- sometimes it’s more work to get it running but learning how to do those things wasn’t ever very stressful to me, and I especially like being able to apply what I learned elsewhere. Never really had a big preference for mouse and keyboard vs joysticks either, or at least not unless I need to zero in on a target really quick (the aim assist stuff they do for consoles these days makes up for it a little, but still.)

    Back around the days of the Super Nintendo it seemed to there were just piles of games I wanted to play but developers have become sort of stagnant since… I’d guess near the launch of the PS2. I still really like seeing the game mechanics in the less mainstream titles so there’s a fair deal more of them for me to play that the titles of a single franchise but it does take some strict evaluating if it’s really going to be worth it to grab a console, especially when I know there that a few years down the road I’m going to have to shell out another 30-50% of the price of it for the new controller type they will be making to see everything the new games have to offer.

    With the ample down time of being single and letting myself fall behind one game in a series (so I got brotherhood when the buzz was all about revelations,) the price and personal value shifts a bit more in favor of buying these things though.

    • Inominandum says:

      Normally I do everything on a PC. I just could not get Assassins Creed to work though, the controls just threw me. If you have any suggestions for configuring the controls let me know.

      I too tend to purchase games after they have been out for a while, increasing their value. Since my PC can handle most games that also keeps the cost down.
      Honestly though if I was single, I would have a PS3 in a heart beat just to play God or War.

      The important thing of course is simply to think in terms of value rather than simply numbers. Everything is relative as far as its intrinsic value.

      • Zorku says:

        Nope, I just put up with the default controls for a few minutes and then I’ve learned then and from then on it seems obvious to me that shift makes me move through crowns in a reserved way and the other things.

        I was kind of thrown off by the tutorial though since they made what I think is a really bad call of taking control away from you without some immediate visual cue. Figured it out based on the real world voices you could hear over it fast enough but that still makes for poor feedback.

        -

        I almost prefer to say that your personal value for things is situational. Calling it subjective is almost like saying you’re a different person while your children go to school.

        • inominandum says:

          I said relative, not subjective, but really it is all three. It is subjective in terms of being personal to ones life.

  6. Jow says:

    That’s the exact same logic I’ve used to not get a gaming PC, play WoW or Skyrim, get Diablo 3 when it comes out, etc. Gaming would either kill my productivity or time with my family, though it would make me more accessible to my friends, just not in person.

    Now I was thinking of cancelling cable and just getting a Wii for leisure/party gaming/netflix, but that is hard to square with the rest of the house. ;)

    • Inominandum says:

      I have a Wii and gotta say, it is great for a party. I also have it hooked up for netflix, but use my PC for that more anyway.

    • Deb says:

      I was just thinking about that again myself actually since I’ve been feeling really media burnt out (farewell, livejournal) but I’m not sure that we’d actually save money really.

  7. I have a PS 3 and the value I’ve gotten from it, in terms of both my own personal enjoyment and the enjoyment that my step kids get out of it makes it worth it. But I also see your point and there’s truth to it. Late at night when I’m playing Mass Effect 3 I’m not working on my business or writing or anything else. But I’m actually glad I’m not because then I’d get burned out. Yes I love being productive, but I think part of being productive is actually knowing when and how to recharge. For me, video games are how I recharge.

    • inominandum says:

      Hi Taylor,

      No doubt. Again, the article was not about the value of a PS3. It was simply about comparing value to value instead of value to number.

  8. Pingback: Value and Wealth | Magical Experiments

  9. Aghor Pir says:

    I haven’t been gaming for several years now; I quit because it was highly addictive, and wasted much valuable time. I also took your past advice and canceled cable and only have netflix now. Its so much nicer to not have to deal with the commercials/ads!

    Adesh!
    -Aghor Pir

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