Carl Richards

Carl Richards is a certified financial planner in Park City, Utah, and is the director of investor education at BAM Advisor Services. His book, “The Behavior Gap,” was published this year. His sketches are archived here on the Bucks blog.

A number of years ago, it was time to buy a new road bike. There was one that I always wanted, but it was more expensive than I could afford. I remember thinking that I should just settle for a cheaper bike, one that I didn’t really want but told myself would be fine.

But I decided that instead of settling for something I didn’t really want, I would wait until I could afford it. Later, I bought the bike I really wanted.

And guess what?

I still have that bike, and I still love it! I’ve watched other people go through three or four bikes in the time I have had this one. In the end, I suspect I spent less money by buying the one that cost more.

We’re faced with these decisions all the time. It may not be a bike, but maybe a watch, clothes, a new car or even a house.

It’s tempting to tell ourselves this little story about being frugal as we buy garbage from WalMart instead of the quality stuff that we want. Stuff that lasts. Stuff that we can own for a long time.

Here is the issue: when we settle for stuff that we don’t really want, and instead buy stuff that will be fine for a while, it often costs more in the long run.

How many shirts do you have in the closet that you never wear because you bought them on sale, despite feeling that they weren’t quite right? Those shirts you saved so much money on are now costing you in more ways than just money.

We have to deal with storing them. We have to deal with the uncomfortable feeling we get each time we see them, knowing that we shouldn’t have bought them in the first place. Then, we have to figure out how to get rid of them. Next thing you know, you’re trying to sell that shirt you bought on sale for $10 for only a quarter at a yard sale.

Why not just wait and buy the $20 shirt you will actually wear and then keep it?

Too often I think we convince ourselves that buying for the long term doesn’t matter. We can always replace it, right? But how much simpler would life and our money decisions be if we bought with the goal of owning that item for a long time?

Taking this approach puts a new spin on how we spend our money. Maybe it makes us think a little harder about what we’re buying. Maybe it makes us wait a little longer so we can afford exactly what we want. Maybe it makes us a little happier about what we have because we’re buying things we want around for a long time.

When we start treating everything around us as disposable, it’s hard to not think of money as disposable, too. And it’s this line of thinking that gets us into trouble.

Don’t be the person who ends up with a storage unit full of stuff you didn’t really want in the first place and an empty bank account. Do be the person who buys good things and then hangs on to them. Both you and your bank account will be happier.