Over the last couple weeks I’ve run through a lot of my philosophy behind saving and investing. I discussed that I invest at least as much as I spend every month because I want to buy options for my life, because I see the value of labor declining over time, and because I don’t want to need to start a new career path if mine gets automated out of existence.
Last week we learned that one of the best ways to buy happiness is to spend money on experiences rather than things. Today, I want to explore a trick to squeeze a little extra happiness out of those same purchases.
The trick is paying in advance for as much of your experience as you can.
This helps increase the happiness you get from your experience in a few ways. First, it separates the event itself from the pain of paying. Next, the anticipation and delayed gratification will make you happier. Finally, in looking forward to your experience, the uncertainty of what is to come will bring you some extra happiness, as well. Continue reading “When Buying Happiness, Pay Up Front”
I apologize in advance for the inherent humblebraginess of vacation pictures. I did warn you, though.
I am generally a pretty frugal person. Three of my lastfour posts have been about saving money. I’ve written about cognitive biases that get in the way of saving money. I’ve written about the best way to hit savings goals.
And yet, I just spent a whole bunch of money on a three-week vacation to South Africa and Spain. This came thirteen months after a trip to Peru. Which itself came eight months after a honeymoon in the Bahamas (which, to be fair, was paid for with hotel points).
This may seem out of character or incongruent with my savings focus. But I don’t save money for the sake of saving money. I don’t intend to be the richest man in the cemetery. And while I would love to reach financial independence, I am not aiming to get there as soon as possible by any means necessary. Instead, I want to live my best (and happiest) life with as little waste as possible. Continue reading “How to Buy Happiness”
This is a great start, but it doesn’t mean anything if you don’t actually put that money away. Instead, our natural tendency towards mental accounting may be eating into, or completely negating, our savings.
As a preliminary note: Thank you all for the well-wishes in response to my last post! I had a lovely month out of the country (although everyone everywhere wanted to talk about Trump and the American election). If you’d like to see some pictures from Johannesburg, Kruger National Park, Durban, Cape Town, and Barcelona, feel free to check out my wife’s Instagram page. I also have some articles on vacation and travel coming up, in which I will include some photos from the trip.
And now back to your regularly scheduled programming…
Imagine for a moment that you are in the market for a new suit. You find one that you like for $200. A fellow customer then tells you that the same exact suit is on sale across town for only $100. Do you go?
Imagine that you are buying a new car. You’ve done your test drives and made a final decision on which make and model you want. You go to the dealer near your home to find that the car costs $30,000. A salesman sees you eyeing the car and says, “My manager would kill me for saying this, but the dealer on the other side of town has this model for $29,900.” Do you go? Continue reading “Your Instinctive Thinking Is Losing You Money”