Vacations = Free Time = Thinking
I’ve been on vacation for the last few weeks in Glacier National Park (pictures forthcoming!). My wife and I got to use our national parks pass right before it expired. We got a ton of value out of the pass. One unavoidable thing about vacations that I came to recognize as necessary evils: gift shops. All those little tchotckes and Glacier branded items probably really help the park’s bottom line. But, I almost never buy anything from them. Quickly browsing or skipping them altogether, gift shops got me wondering about my own personal buying philosophy.
A Buying Philosophy
The act of purchasing something is often personal, emotion-driven, and made with almost zero reflective thought. Many of us largely rely on intuition when making a buy, whether that’s out of habit, cognitive miserliness (our tendency to want to conserve mental resources), or because we don’t often have the time to do in-depth analysis. Usually, we reserve detailed comparisons and note-taking to large purchases of non-perishable items, such as automobiles, televisions, and computers. While these more costly purchases can lead to big one time hits to the wallet or purse, our daily purchases are usually the ones that send us over budget or keep us on track with our savings. So while we can spend too much time over-thinking a purchase, we can also spend too little time and under-think, leading to inefficient spending and regret. What we want to do is strike a balance between analysis-paralysis and willy-nilly spending– since a dollar saved today is many more dollars we can spend down the road (a concept called temporal discounting). To help myself stay on track with making the “right” purchases, I developed a method I call VCR– value, cost, and replacement, whenever the item I want (or think I want) is above a pre-set dollar threshold. While I didn’t realize that I did this almost unconsciously with every purchase, upon deeper reflection and introspection, I was able to figure out that I did have a personal buying heuristic that I employ on a regular basis. Read on to find out more about how I think about buying.