The next step is happiness/price.
Dont think of price, think of cost per use
141–150 of 185 posts
Re: Dont think of price, think of cost per use
#142My spending habits changed considerably when I started to include the cost of real estate required in my calculations. I encountered this first in a forum discussion about boilers - someone pointed out that the largest cost component isn't even the unit itself, but all the space it takes. Anyway whenever I think of buying a treadmill, I remind myself that the actual cost is an additional €4500 just for the real estat…
If you don’t buy the treadmill, you don’t save money on the real estate you already own. It either goes unused or is used for a different purpose. Is this really the right way to think about the trade offs?
Makes a lot of sense if you're space constrained, could see yourself getting space constrained in the future, or value open space. Even then, though, if you needed the space for something else, you could recoup all of the real estate cost and some of the cost of the treadmill by selling it.
Re: Dont think of price, think of cost per use
#143Earlier quoted context omitted.
> Have you seen what has happened to the market for fuel inefficient vehicles lately? I have not. What has happened? Have SUVs stopped being the most popular class of passenger cars being sold?
The demand for the big diesel SUVs that get about 9 miles to a gallon has gone away, and people are trying to sell them for 20% of what they'd bring a year ago.
> The demand for the big diesel SUVs that get about 9 miles to a gallon has gone away, and people are trying to sell them for 20% of what they'd bring a year ago.
Any idea what they are replacing them with? Diesel's are pretty fuel-efficient after all, compared to petrol.
Re: Dont think of price, think of cost per use
#144A related idea is depreciation. You haven't lost $700 by buying a pair of skis. You have exchanged $700 in cash for at least $500 in a pair of skis that is now previously owned. So you might lose, say, $200 immediately for the privilege of buying something brand new. And then another $100 if we include up-front the effort to sell them to someone else. But the rest of the money is still there, in the shape of skis. As…
Meh, second hand ski market is very patchy, the selection isn't great and different boot sizes might require binding remounting. Skis only last 100 or so days so cost/day is tiny compared to other ski expenses. You could save a few hundred dollars by buying second hand but then you have a big risk of injury from bindings not working properly. The time and effort looking second hand is a big factor too.
Re: Dont think of price, think of cost per use
#145You could make the argument that the phone, combined with all the extremely addictive "services" it provides, is just a piece of hardware that allows the advertisers to use you (via these services, like social media).
In that case it's you, paying thousands for the hardware, to enable others to use you and the limited time you have on this earth.
Re: Dont think of price, think of cost per use
#146Earlier quoted context omitted.
I see so many people talk about the Boots theory, and while I don't disagree, there's another side to the story. What if you buy a really nice pair of boots that will last a lifetime and then a couple years later you move to a beach town where you wear sandals all day? Or what if you get paralyzed and have no need for durable shoes? The point is that life is unpredictable and both your circumstances and preferences c…
The boots theory also falls flat in regards to style. I've never seen a single person wear boots older than maybe 10 years. Paying 3x-5x on anything with the "once a lifetime" ideology only works for timeless stuff like wrenches, measuring cups, or anything that hasn't remotely changed since 1945. Which is a very small list.
Utilitarian boots that can be resoled/repaired can absolutely last a very long time. I have a custom made pair of hiking boots that are a good 20 years old or more. If you're referring to fashion wear, you're quite right.
Re: Dont think of price, think of cost per use
#147You could make the argument that the phone, combined with all the extremely addictive "services" it provides, is just a piece of hardware that allows the advertisers to use you (via these services, like social media). In that case it's you, paying thousands for the hardware, to enable others to use you and the limited time you have on this earth.
There's some parallels to traditional animal husbandry.
On the one hand, we domesticated some cows to get milk, in another sense the cows have enslaved the farmers and gotten them work all day to pamper them like royalty, the farmers ensure there is always food in all seasons, they're made to build the cattle shelter from the weather, they go out and hunt predators, they shovel manure, they get up at ungodly hours to milk the cows, and so forth.
So who actually domesticated whom?
Re: Dont think of price, think of cost per use
#148Earlier quoted context omitted.
It's not backwards, but nothing is black and white. An example of where looking at the cost per use makes sense is a gym membership. --If I consider the gym is worth, say, $5/visit and it costs $50/month, then I know I have to go at least 10 times a month to feel like I'm getting what I'm paying for. On the other hand, yeah, my phone is not something that I'm going to try and figure out a cost per use, not the least…
> then I know I have to go at least 10 times a month to feel like I'm getting what I'm paying for. This is also dangerously close to going backwards about it. Figuring out how much you need to do something purely to "get your money's worth" out of it is the sunk cost fallacy! It's better to start from how many times you want to go to the gym, multiply it with your desired cost per visit, and then see if this total ex…
>It's better to start from how many times you want to go to the gym
Which you may or may not get close to.
It's easier with subscriptions generally. It's a good idea to constantly be reviewing how much you're using the subscription and how much value/benefit you're getting from it. And of course, that equation can change over time if the subscription fee goes up or you stop using something as much.
Re: Dont think of price, think of cost per use
#149Earlier quoted context omitted.
I see so many people talk about the Boots theory, and while I don't disagree, there's another side to the story. What if you buy a really nice pair of boots that will last a lifetime and then a couple years later you move to a beach town where you wear sandals all day? Or what if you get paralyzed and have no need for durable shoes? The point is that life is unpredictable and both your circumstances and preferences c…
You've perfectly described one half of what makes me uneasy about "boots theory" which is the added risk of making fewer, larger purchases. The other half is that I find that often the more expensive choice does not have as much quality as needed. Boots theory depends on finding product choices where quality (ie durability, ie expected lifetime) increases faster than price. But my personal experience is that quality…
It makes more sense if you look at it from the manufacturer/seller perspective. When customers are extremely price sensitive, what do you cut from your product?
There are plenty of answers to the question. But one approach is to make sure it looks as good and works as well for the return period, but doesn't last as long. E.g., you use less material, short the structure in favor of the surface, use lower-quality material, invest less in production quality, or offer shorter warranties.
For example, think of a raincoat. On one end of the spectrum we have the $0.99 disposable poncho, which is basically a garbage bag with a different cut. Up from there are all sorts of methods of improvement: https://www.rei.com/learn/expert-advice/rainwear.html
The better raincoats tend to be correlated with price because if a feature doesn't require additional expense, low-end manufacturers will just add it. And also because while many consumers aren't discerning about quality, many are, and will pay extra for it. Places like Wirecutter and Consumer Reports do the sort of testing that helps keep people honest.
That said, you're very right that there are many other things that influence price. A Burberry raincoat will be 10x the price of REI's favorite raincoats, but it won't last 10x as long. So Boots Theory, which is about good pairs of boots being more expensive than shoddy ones, is correct. But you can't work it the other way and claim that expensive things are always good in the way a night watchman thinks about his work boots.
Re: Dont think of price, think of cost per use
#150Earlier quoted context omitted.
I see so many people talk about the Boots theory, and while I don't disagree, there's another side to the story. What if you buy a really nice pair of boots that will last a lifetime and then a couple years later you move to a beach town where you wear sandals all day? Or what if you get paralyzed and have no need for durable shoes? The point is that life is unpredictable and both your circumstances and preferences c…
The boots theory also falls flat in regards to style. I've never seen a single person wear boots older than maybe 10 years. Paying 3x-5x on anything with the "once a lifetime" ideology only works for timeless stuff like wrenches, measuring cups, or anything that hasn't remotely changed since 1945. Which is a very small list.
I know someone with vintage Doc Martens from the 90s that they still wear. I personally find Doc Martens uncomfortable, but I am happy to introduce you to them so you can confirm that old boots do get worn.
I have a pair of dress shoes that are approaching ten years old. I spent more than I ever had on any pair of shoes but they continue to be comfortable and are easy enough to resole, clean, etc.
There are enough items in the world of apparel (I hesitate to use the word "fashion") that are timeless, at least on the scale of a human lifetime. My belt is twenty years old. My watch (due for service) is over twenty years old.
A good shirt will last longer than a cheap shirt. If you buy carefully (i.e. not just what's in "fashion" that season), it can work for a long time.
I had a US-made dress shirt that lasted me close to 15 years and I think I spent less than $40 on it. It's a shame those mills are long gone because few shirts last that long and I'm not willing to find out if spending $400 on a shirt gets me the same quality.
At some point clothes become a Veblen good. The idea is to spend on quality, not on marketing or details that don't add to the durability of the item.