The Value of a Dollar

Here's a thought: things that are supposed to be a deal aren't worth your money, but neither are a lot of things that cost multiple paychecks. This concept popped in my head today (the juxtaposition of dollar store wares vs. luxury goods, of course) and I wanted to ramble it out.

First off, let's talk about dollar stores. For those of you unfamiliar with the concept, these are like department stores, but with crappier departments. Some feature all items that are only a dollar (such as "Dollar Tree"), while others feature things that are multiples of a dollar, but still very cheap (the concept behind "Dollar General").

Why am I such an expert on this sort of retail? Well, my hometown has more dollar stores than I can count on one hand, so I have a pretty good grasp of how this business model works.

Anyways, many of the things at these stores may be useful, but others are simply unnecessary. Unicorn statues, Ghostbusters stickers, and a ball on a string with a paddle come to mind. Just because something is only one dollar does not mean we are getting a good deal on it, or that we need it. You can apply this concept to any clearance bin of any store if you wish, but the point is that people never consider what they are getting in return for their money. They simply view their purchases as a deal.

On the complete opposite end of the spectrum are things that we want that cost too much money. The first example I think of is in the category of expensive pens. Did you know that a Mont Blanc (i.e. fancy pen) can be several hundred dollars? That better be a damn good pen. But is it, really? I've never had a problem writing things down without one. Perhaps a Bic (from the dollar store even) could do the job.

Am I asking everyone to purchase only goods and services that fall in the middle of these two categories? Not particularly. But what I am suggesting is that many of us have skewed value systems when it comes to the dollar. If we stopped to think about how much work it took us to earn our dollar, we would not buy silly things (as much).

For example, if you make $15 an hour, it would take you 40 hours of work (i.e. around a week for a full time job) to purchase one Mont Blanc. On the other hand, you could buy 40 unicorn figurines for an entire week of work. For some of us, these things may be worth it. But for others, this simple math calculation may be enough to persuade them out of buying something.

So, what is the point of all of this? What should we be spending our money on? A few ideas:

1. Stocks, bonds, IRAs. Some people may think of value as savings or retirement accounts, and these are both very commendable ways to spend extra money. I can't really make fun of this at all.

2. Entertainment. Many people cannot remember the exact second that they bought a unicorn figurine, but many can remember going to their first baseball game, concert, monster truck rally, or vacation. Instead of thinking of entertainment as wasted money, we should think of it as an investment in fond memories.

3. Something you may actually want for a long period of time. Think of something you want, then don't buy it for a few days. Save up for it, and decide after a few days (or weeks) if you still want it. It could be a frivolous item or something more practical, but actually pondering over spending money may be a better decision than split second purchases of any kind. Plus, you will not have buyer's remorse if you've spent more than 5 seconds on deciding whether or not to buy something.

Well, hope this gave everyone a little bit of perspective. Yes, people who waste lots of money on expensive things they don't need may have the wrong idea. But so do people who spend lots of money on a large quantity of trivial, cheap things. Maybe we could all use a bit of focus so we could get back to spending our money a bit wiser.