February 6, 2010


How you spend your money reveals your values.

You may make small purchases without noticing how they quickly add up. That's the concept of the latte factor which was recently discussed on other blogs in Rethinking the Latte Factor (on Million Dollar Journey) and When the Latte Factor doesn't work (on Thicken My Wallet).

You probably notice your larger expenditures when you receive your credit card statement. Think back to your latest sizable purchase. Let's say costing $500 or more. Pick something smaller than a condo or house. What was it?

Here are some ideas.
  • a bike
  • a boat
  • a car
  • cookware
  • clothing
  • a computer
  • an exercise machine
  • golf clubs
  • a gym membership
  • an HDTV
  • a home renovation
  • jewelry
  • a pet
  • a purse
  • a smartphone
  • software
  • a stove top
  • tuition
  • a washing machine
  • a wrist watch
  • a vacation
Relax. This blog post won't ask why you buy or suggest you save the money instead. Maybe you're saving on lattes to buy something big. That's fine. We're looking the how, not the why.

Your Decision Process
When you made your $500 purchase, how did you decide what to get?
  • the brand
  • the design (elegance or functionality)
  • the features (as few as needed or as many as possible)
  • the price (low, medium or high)
  • recommendations from others
  • the retailer
  • the return policy
  • the warranty
How much time did you spend deciding? Did you buy on impulse or research extensively? Was your research online or in store?

Many Factors
Many factors affect our decisions. Most aren't logical because we aren't ... even if we pretend we are. What does how you bought say about you and how you can be influenced?


Podcast Episode 53 (2:57)

direct download | Internet Archive page

PS The way we decide varies. You might buy electronics online and clothing in store. We might migrate from name brands to generic. Or vice versa.

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