The economics of ‘I want’

It is amazing how easy it is for us to be lured into thinking that we need something that we wouldn’t have thought about in the first place.

Lately I have been developing this urge to get an iPad. I cannot understand why people are so fixated over their iPhones, at least 70% of the people I meet are constantly fiddling with that gadget. It makes those who aren’t wielding one seem like they are missing something in their lives.

That’s when I started thinking about having an iPad. It began as an initial thought about how interesting the gadget is, a portable touch-screen mini-processor that you can work on using the productivity tools, or surf the Net wherever you are or leverage on the thousands of free apps And since it isn’t an iPhone, I wouldn’t technically be following the trend.

It was only when I read the honest reviews of the device that I started having second thoughts. I mean do I really really need it? It would cost me about $1,300+ for the 64GB Wifi + 3G set. What can the iPad do that my smartphone or laptop not do? Granted I don’t have an iPhone but if I did, there would be little else. Anyhow the reason I didn’t get the iPhone was because I needed a QWERTY keypad for me to work on my documents.

So you see, people are really irrational when it comes to spending money but are surprisingly rational when it comes to saving it. Recently we had an interesting discussion thread on our Facebook about retirement planning and there were many who lamented that retirement planning is only for the rich. As standards of living are so high, it is not possible to save without sacrificing present lifestyle. Really?

I was suddenly inspired to start an experiment of saving $5 a day, every single day without fail and to blog my journey. It doesn’t sound like much but it is $1,825 a year and if it is invested at 5% rate of returns over 25 years, it sums up to be $84,000! Just from $5 a day. Many people blog about financial planning theories but really no one has talked about living it up. Hmm I think I will sound it out to my manager and if he’s not for the idea, then I guess I’ll blog it here then.

Maybe then I might have enough for that iPad, if I really still need it.

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