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
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