Responsible Spending (Using Accumulated Value)

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A powerful way to ensure responsible spending is to quantify your accumulated value with your purchases. Once you factor in the cumulative value, or long term value, of the things you buy, you can make much smarter purchases and implement smart spending habits.

In this Livestream, we go into more depth on our lesson on amortizing purchases and calculating cumulative value to ensure responsible spending and making smarter purchases. 

Below are a few of the topics we cover:

  • Monthly expenses vs one-time purchases
  • Shifting from a “single expense" mindset to a “cumulative value” mindset using amortization
  • Example: refrigerators are expensive, but on a monthly basis, they are a great deal
  • We're better at grasping monthly payments than single expenses
  • Amortizing expenses using life of the item vs amortizing expenses through frequency of use
  • Renting vs buying items: when does it makes sense to buy? Where is the breakeven point?
  • Tradeoffs of renting or leasing vs buying items
  • How gym memberships are profitable for gyms (proving we aren't good at calculating cost over time)
  • Using your personal context to calculate your cumulative value and make responsible spending decisions

Happy Wealth Staking!