Normally the Wall Street Journal starts touting tech innovations three months before they’re on the market, and then spends the next three months reviewing how they don’t work quite right. Got to keep that market churning, no? But two recent articles about trends have me amused and bemused, and I think they relate to how much dough you hold onto.

 

The first one was on how people are not replacing their electronic devices as fast as they used to. Basically, after the initial kinks are worked out (and that time span is getting shorter), electronic devices pretty much work. As long as there’s not a major change in the operating system, many people can put up with occasional crashes and slow response, especially since there’s no guarantee they won’t experience those same issues with the brand new device. I can see this with my own experience with e-readers. I stood in line one Black Friday to purchase an early Nook for $100 back in, I think, 2010. It was good for about a year before I got tired of the torturous internet connection, as soon as I discovered that links and the ability to research something online that I’d just read about was one of the chief benefits of e-books. In December of 2011, I purchased an iPad 2 and I haven’t replaced it yet. I did bash the screen in, but when I thought about replacing the whole thing, I decided I could live with it by spending the $100 or so to replace the screen. It was just good enough—even though its crash rate has gone up since various iOS updates.

 

My cell phone contract is up next month, and I’m thinking over whether I’ll replace my iPhone 5. It works just fine, but if I don’t, I read that I’ll still be paying for the same phone over the next contract, and I hate to pay twice for the same thing. My desktop dates from who knows? 2010? 2011? I used to assume computers were good for 3 years, mostly because of operating systems and updated software not working on old ones, but right now I’m not seeing any problems. Still, at some point I’ll probably switch to an all Apple system.

 

What’s the financial planning point? Well, things have changed. I used to fantasize about being an early-adopter—one who was always the latest with the greatest. In fact, I lusted to be able to afford the $2,500 Macintosh back in the 80s. But I’ve seen enough computer history to have learned that 1)the price comes down in 2.0 and 2) 1.0 usually doesn’t work very well. So being an early adopter is a little bit like lighting a cigar with a $100 bill—fun and flashy but a waste.

 

Lately I’ve seen the same thing with cars. When I was a kid, many people replaced their cars every two years, the more frugal waited five, and you were driving a rust bucket heap with fenders flapping by ten years. Then cars just got better. My clients routinely drive cars that are ten years old, with the oldest one so far a 1989. Virtually every one of these people could have bought any car they wanted.

 

Besides the fact that at least some devices seem to be better made and last longer (hear that, clothing industry?), I think a lot of people (my hand is up) simply hate the research required to buy a complex device, and in the case of cars, the overwhelming feeling that you will be taken every time. .That especially, and the fact that I have a kid in college, keeps me driving my 2002 Subaru.  It’s very easy to just keep putting it off until you have a complete breakdown. Consumer Reports has an interesting scale on fix vs. replace—if the fix costs more than 50% of the value of the car, replace. When I think about the cost of a couple of months of car payments (or the sticker on a new car), fixing has won so far. For other things, check the warranty! My daughter recently picked up a $300 set of Bose headphones from the free box at her college—they were still under warranty and she had them fixed for $100 (apple didn’t fall far from the tree).

 

Finally, this morning WSJ had an article on trendy food. There’s not much I won’t eat (lima beans and jello mold), although my daughter reserves a special circle of hell for kale. But I’m always stunned by food trends. Local and organic make sense to me based on quality and taste. But pot roast out and pan-sauced chicken breasts in? No one eats turkey tetrazzini anymore? People aren’t ready for Moroccan sauces?  Jeez, if it tastes good, it tastes good, and I don’t care if my mom used to cook it in 1957. It always stuns me that when I make a moron-level cake from the Joy of Cooking, people rave about the taste. In fact, lately if I simply make a cake from a box, people rave about the taste because all we are ever served nowadays is ersatz cake product from Sam’s, Jewel, or Costco. Years ago I was stunned to learn that éclairs never have actual custard filling anymore, because they’d have to be kept chilled. I never look at Facebook that some friend hasn’t linked to the latest hype on what we should eat, what precise method of exercising is best, and please god save me from all the vegan mumbo jumbo.

 

What I chiefly object to is that once it’s trendy, it becomes way more expensive. Ask my dog—she USED to enjoy chicken wings. We have no idea what’s seasonal anymore (hint, it’s usually what’s cheapest) and cooking shows are entertainment not instruction (except for my beloved Jacques Pepin).

 

Okay, before I rant on for several more pages, let me summarize the financial points I’m making:

 

1. Save yourself time, money, and aggravation by being slow to adopt the new
2. Fix it when it’s broke, as long as it makes financial sense
3. Try to resist hyped trends. They’re making a fool of you.
4. Don’t keep up with the Joneses. They don’t have any money saved for retirement.

Grumpy cat will now return to her regularly scheduled programming.

 

 

 

We all know money doesn’t buy happiness. We also know that having no money can really affect happiness. But can you handle money in specific ways to increase everyday happiness? I’ve been reading The Happiness Project by Gretchen Rubin, and one idea really caught my attention.

Rubin talks about two different orientations: in simplest terms, the underbuyers, who put off buying things until they run out, wait out pains or illnesses to see if they’ll go away, and never pop for the expensive haircut or premium manicure. Then, there are the overbuyers, who have far more sheer stuff stashed and spend on things that make them feel good. Enough stuff, and they may even be thought to be wealthy (read, the oversized house and pretentious car).  In fact, whether things make you feel good may be one way you can tell which you are. Another way—check how much toilet paper is currently in your house.

Of course, few of us are purely one or the other. I tend to fall on the underbuyer’s side, but I have plenty of toilet paper (that problem will get me out to Sam’s Club in a flash), and book buying, er, we won’t go there. Nevertheless, people I see with a lot of money stashed in investments tend to pursue an underbuying strategy, in the main.

While we might think underbuyers hold onto their dough better, it can produce a lot of stress to be out of essentials or unwilling to spend on care or services you really need. Safety, serenity, health, security, and pleasure have real monetary and non-monetary value, and time is the most expensive commodity of all. On the other hand, so many things we purchase are the whim of a moment, and delaying that purchase may eventually mean no purchase at all, and money saved. I think just-in-time inventory and thoughtful spending are a reasonable mean, and I think Rubin would agree. Frugal, not cheap—cheapskates who try to shift expenses to other people (e.g. the guy who never picks up his full share of the check) are reserved for one of my personal rings of hell.

Overbuying tends to diminish wealth for two reasons: waste and cost of inventory.  It’s not wealth if it’s rotting in your refrigerator or still has the tags on it in your closet. Storing our overbuying has made Container Store a fortune. And, that money spent on too much could have stayed invested and growing. But pleasure is worth something, too. As long as it really does give you pleasure. My mother used to keep a fully stocked freezer in the kitchen. And another one in the basement. And another one in the garage. When she died there was so much meat it took us nearly two years to eat through what we didn’t have to throw out based on label dates. But she had known real hunger as a child, and if that made her feel secure, well, they could afford it.

Mom and Ms. Rubin are both on to something. Small splurges can make for happiness. Buying things you truly want, and paying for services you really need, make for happiness. And ultimately, in many more excellent chapters, Rubin sees happiness in balance. Michael Pollan has a now-famous dictum on everything you really need to know about eating: Eat food. Mostly plants. Not too much. From this book, I think I could derive a few simple money rules. Spend thoughtfully. Mostly on experiences. Just enough. Not as pithy as Pollan, but if most of us did it, we’d be both happier and wealthier.