I don’t think of consumption as a financial investments. Rather, these transactions are emotional investments. They make you happy to some degree. If I spend a little more on a car that I enjoy driving, it gives me much more joy than driving a lame car and seeing the numbers in ink on my bank account statement be $100 a month higher.

I don’t think we should spend spend spend to just consume and chase that never-ending target of wanting more and more, but we shouldn’t feel guilty for spending and we should enjoy our money.

Any one of us could die tomorrow. When my dad passed away, my mom felt sad to have life insurance money that she couldn’t enjoy spending with him. I wish he could have enjoyed using more of it before he died given that he knew his kids would be ok financially.

Atul

Like the coat, which is a good investment. You could spend $50 on a “cheap” coat that wouldn’t last as long. Or you could spend a little more and have an item that will last for years.

My parents, who were decidedly in the working class, also thought of things like a good coat as “investments” and so would try to buy the best quality they could afford in products such as appliances, clothing, and furniture. Thank goodness! When we returned to the U.S. after 10 years overseas, my mother bought a very nice set of solid birch furniture, which she cared for well and left to me. Because of her wise investment in quality products, I had decent bedroom, living room, and dining room furniture to fill my apartment when I left my marriage. All that (now retro!) stuff is still in use, and occasionally admired by friends.

One drawback to thinking of consumables as investments, though, is that some marketers pitch their (unnecessary, extravagant, why-do-i-really-need-this) products as “investments,” when more likely the word they’re groping for is “indulgences.”

I hope that this way of thinking would at least help people learn from their spending mistakes and understand their spending patterns. But like other ideas, it can be misused.

I’ve often seen people use the term “investment” to justify a luxury purchase, to make themselves feel better about spending money on something that they may have not needed or more money on something they did.

It could be something like a designer purse, or a big house with even bigger mortgage payments. I’m speculating here, but that mentality is probably what drove at least some of the people who are now facing foreclosure to take on more house than they should.

For the already frugal this mindset would probably work, but I think if you’re climbing out of debt this could just become a way to rationalize spending more than you can afford.

I have seen friends of mine purchase a boat. The bought the boat when the could not afford the time. After a couple of weeks unused they guilted themselves into using the boat. This guilt of getting value from something made them use the boat twice a month for the next 2 years. The still never had the time but the forced themselves to get value on their purchase and the became slaves to their boat. I understand we don’t want to throw it into the drawer and not use it, but we don’t want to force ourselves to create value in something when it doesn’t fit. The bottom line is buy what you need/want, don’t want what you do not need.