Would You Still Buy It If You Couldn’t Show Anyone?
Before buying the next thing you “want” but don’t need, I urge you to consider this question. As a thought experiment, pause to imagine if you would still want it if you couldn’t show it to anyone, or even talk about it. If the answer is no, that’s a strong signal that your money could probably spent more intentionally.
We spend money on all sorts of things for a variety of reasons. We live in a world where impulsive spending is frictionless and encouraged. It often takes some effort to be intentional with our spending but failing to do so can be counterproductive for meeting our long-term goals. If we fail to reflect it is hard to grasp what the true value we are getting for the money we spend. Sometimes you must dig a little bit.
It's tempting to think that people would like you if you had nice things, but the truth is never that simple. You also should ask yourself if the people who base their opinions on material possessions are even people that you would want to impress?
For example, let’s imagine getting a fancy new car as a status symbol. When you see someone with the car and think to yourself “I want that car” why do you think that? Do you think that car would make you cool? Is the person driving it right now even cool, or are you just ignoring them while imagining it was your car? If you don’t even think that person’s cool do you really think having that car would make other people think you’re cool?
“It’s a subtle recognition that people generally aspire to be respected and admired by others, and using money to buy fancy things may bring less of it than you imagine. If respect and admiration are your goal, be careful how you seek it. Humility, kindness, and empathy will bring you more respect than horsepower ever will.”[i] Morgan Housel, The Psychology of Money.
We can be poor predictors of how possessions will impact our happiness, especially in the long run. We also tend to overestimate how much other people think about us due to the spotlight effect[ii].Though we might initially get some joy out of impulsive purchases there tends to be diminishing returns because of hedonic adaptation[iii].
