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But in terms of how spending effects ones psychology and the underlying reasons for the spending, well, those things matter.
As someone who is a psychologist...No, they really do not matter that much when speaking in generalities.
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Originally Posted by user_id
Spending $70k on an automobile says something about a person, of course,
As does someone commenting on decisions made by people they do not even know.
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Originally Posted by user_id
Folks that buy luxury brands never have good reasons for buying them, yet the marketing techniques work because people largely make spending discussions with their brain-stem.
Some people buy things simply because they like them. This is not limited to "luxury items". I have a few friends who, when they drink beer, only drink Bud Light - I cannot understand any good reason for choosing to drink crappy beer - I guess they just happen to like it. Or maybe they fell prey to their commercials and marketing - which is also not limited to luxury items.
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Originally Posted by manderly6
It is funny when people who aren't buying bottom of the barrel items that would satisfy the basic requirements of whatever that thing does come out and say people buying something better than what they have are wasting money. As if they somehow have been designated to set the bar on what is wasteful and what isn't.
If you don't shop at Big Lots you're spending too much.
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Originally Posted by user_id
I mean, who finances a TV?
I financed the last one I bought. I could have paid cash. Instead, I put it on a 15 month, no interest financing plan, put the full cash amount in a 12 month CD (this was when CDs still had a decent return), waited 12 months, cashed out, paid the TV in full and the interest I made paid for a full years worth of Netflix - so it was like getting a year's worth of free movies for the new TV.
Quote:
Originally Posted by user_id
my claim is that financing makes people feel wealthier than they really are and this results in higher overall spending.
Depends on the person. For someone who spends above their means, maybe so. For those who are smarter about their finances, your hypothesis is not necessarily true. There is a difference between using credit wisely or unwisely.
Yep, realize that just fine, but you have a epistemological problem. How exactly does one know if they are or not susceptible? In the case of credit cards vs cash its relatively easy to find out, in other cases its extremely difficult or impossible. So one is faced with two options, assume one is susceptible to corrupting involves and avoid them when possible or assume one is superhuman and not avoid them. If you do the latter by the time you figure out you were wrong its likely to be too late.
Of course, I addressed this in a previous post, I'm not sure what's with you NJ folks and reading...
so. if i go out and want to buy a honda accord ex and refuse to finance it, the logical conclusion in your mind is that i won't overspend, because i'm against financing it. but, if i go out and want to buy a honda accord ex but am open to financing it if the financing options are enticing enough, i will overpay for it?
even though the price negotiations happen before i even get to financing?
the total cost of the car as far as sales price will be negotiated to the same dollar figure, whether i pay cash or finance it. yet somehow, i'm susceptible to overspend???? you make zero sense at all.
your logic leads me to believe that because you swipe your credit card at the grocery store instead of paying cash, maybe you pay too much for your mustard. oh wait, that's right...you tested it. nevermind. i didn't realize you need to test a budget based on payment method. i forgot that whether or not my grocery budget is $100/week, i'm susceptible to overspending if i finance my groceries. even though, i refuse to spend more than $100/week. something magical happens.
the bottom line is, no matter what the payment method, if the invoice on an accord ex is $22,896.28, and dealer holdback is 2% of msrp ($25,255)...that means my purchase price will fall somewhere between $22,391.18 and $22,896.28. whether i show up with cash or a check from my credit union is irrelevant, because i'll email every dealer i can feasibly drive to without wiping out the lower price in spent fuel to get as close to the holdback price as possible.
sorry you don't understand how that works. but now go ahead...tell me, i have no way of knowing if i'd pay that price, because i've never tested it (except that...you can't get a lower price unless the dealer is willing to lose money).
No I want people to serious think why they are buying things. If someone is buying a corvette because they are having a mid-life crisis then its not going to provide value. Honestly....I can't think of many good reasons to buy a corvette...
You can pretend as if spending decisions have nothing to do with status displays and other social issues, but that isn't the real world.
You're still not listening, I provided a definition of what it meant for a product to have premium pricing. This isn't some definition I pulled out of a hat, its a standard term in the business world.
Cars in the 20k~30k range at times have some premium priced items on them, but as a whole they aren't premium priced products. Where as once you get above $30k you start to see premium priced cars. As I suggested before, the numbers I'm citing are just rough. Additionally, you don't start to see premium pricing in the mega-cars until you get over $50k or so. But the mega-cars are still conspicuous items.
bull poopy buddy. i work in the business world. i know how pricing works. bottom line is, a car in the $20-$30k range has plenty of premium pricing in them. you don't need the stereo that comes in them. you don't need the sound proofing. you don't need the power seat. you don't need dual climate control. yet most cars in that range, especially as you get closer to $30k, have those things. fact is, you don't need the cars that cost more than $11-20k. but go ahead, keep telling yourself your little schtick. it's working for you, but there are plenty of people who believe you are wasting money on your vehicle too. if i want to buy a sports car that goes 0-60 in 3 seconds, but doesn't use an ounce of gasoline...i can do that. but i have to pay for it. if i have the money and that's what toots my horn...it's worth it (to me...the buyer). that's called supply and demand. you claim you understand eco101 but you don't.
People don't exist in voids, they are part of social systems, as a result you can't separate these two. Nobody buys things purely for themselves, their social infrastructure always plays a role.
How many people would buy a diamond ring if nobody could see it? How many people would spend $70k on a car if it appeared as a pinto to everyone else?
i'll buy whatever car i want. i don't care who sees it, or doesn't see it. i go out in my driveway on a sunday and wash, clay, polish, and wax my car because I like how it looks when that's done, not because I care what my neighbor thinks about how it looks. now, when i go around town wearing my shirt that says i have a 12 inch you know what...that's when i care if people notice. i kid, i kid.
bottom line is, some people out there, believe it or not, buy things because they want them not because they want to impress their neighbors. i used to think i'd never buy a pair of what i considered "expensive" jeans. after tossing numerous old navy or gap or other jeans in the garbage from the fabric wearing through, i stumbled upon a pair of jeans on sale at nordstroms for $65. i had no idea what the brand was, but i liked how they looked and tried them on and liked how they fit, they were comfy too.. i never would have paid the "msrp" price, which is what they charge outside of their semi-annual sale, or other sales that they run infrequently, but i bought them for what i thought was still a bit much for a pair of jeans. i've had them for 5 years now, which long outlasted all those $20-$40 jeans i've bought. but more importantly, i love the looks i get from woman gawking at my behind. so now, i buy a pair per week, just so i can plaster the outside of my house with them to tell the world i'm a brand-*****!
I'm just glad user_id is looking out for all of us. Who else is going to save us from making the purchases we want and remind us of all our deficiencies?
Some people buy things simply because they like them. This is not limited to "luxury items". I have a few friends who, when they drink beer, only drink Bud Light - I cannot understand any good reason for choosing to drink crappy beer - I guess they just happen to like it. Or maybe they fell prey to their commercials and marketing - which is also not limited to luxury items.
it's better than bud heavy! honestly, not sure why people ingest that stuff at all. i can make beer at home for the price of a case or two of bud light that tastes 100 times better than that crap. talk about wasted money! but yeah...some people just like it.
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Originally Posted by Tober138
I financed the last one I bought. I could have paid cash. Instead, I put it on a 15 month, no interest financing plan, put the full cash amount in a 12 month CD (this was when CDs still had a decent return), waited 12 months, cashed out, paid the TV in full and the interest I made paid for a full years worth of Netflix - so it was like getting a year's worth of free movies for the new TV.
Depends on the person. For someone who spends above their means, maybe so. For those who are smarter about their finances, your hypothesis is not necessarily true. There is a difference between using credit wisely or unwisely.
uhoh...you're completely discredited...you financed a TV. honestly?! who does that?! crazy!!!
I'm just glad user_id is looking out for all of us. Who else is going to save us from making the purchases we want and remind us of all our deficiencies?
i think you wasted money cause you live in marlton. you know...you could have just bought a house in camden for like, 1/10 of the price!
i think you wasted money cause you live in marlton. you know...you could have just bought a house in camden for like, 1/10 of the price!
Oh no! I live in West Windsor, NJ! Man, did I waste all my money...
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not because they want to impress their neighbors. i used to think i'd never buy a pair of what i considered "expensive" jeans. after tossing numerous old navy or gap or other jeans in the garbage from the fabric wearing through, i stumbled upon a pair of jeans on sale at nordstroms for $65. i had no idea what the brand was, but i liked how they looked and tried them on and liked how they fit, they were comfy too.. i never would have paid the "msrp" price, which is what they charge outside of their semi-annual sale, or other sales that they run infrequently, but i bought them for what i thought was still a bit much for a pair of jeans. i've had them for 5 years now, which long outlasted all those $20-$40 jeans i've bought. but more importantly, i love the looks i get from woman gawking at my behind. so now, i buy a pair per week, just so i can plaster the outside of my house with them to tell the world i'm a brand-*****!
