05.15.08 | Managing Money, Value and $1,200 Handbags
My girlfriend loves fancy expensive handbags. We walk by them in a department store and I’ll hear “ooh, isn’t that
absolutely gorgeous?” I’ll look at the $1,200 price tag and reply, “no”. If she had the extra $1,200 I’m sure she’d buy it although she isn’t going to spend $1,200 on a handbag when she needs the money to pay back her student loans and save up for a class she wants to take instead. Those things are slightly more valuable to her right now. The concept of value is what I want to discuss.
How can the same handbag represent no value to me and high value to her? The price tag certainly conveys price but it apparently doesn’t convey value. Would the same hand bag be as attractive at $10 in a bin at Target? That is up to you because an object’s value depends on you (or should) rather than the price tag. You assign value to things; the things don’t assign their own value. Keep in mind that the job of marketers is to try to do this for you which is why making things super expensive sometimes has the effect of inflating value to customers.
Thinking about and understanding the relative value of things in your life will help you to save money, to make good financial choices and to stress-out less about incurring debt. You are the master of value in your life and you need to learn to be a shrewd evaluator to stay out of debt and to get ahead in life.
Only you can answer questions concerning value. To illustrate this, here are some questions which I can’t answer for you due to reasons mentioned above. I want you to think about them and I bet you’ll find that you can argue both sides of the value discussion.
- Are 4 years at a private college more valuable than 2 at a community college and 2 at a private college given that the cost is vastly different?
- Is a more expensive new text book more valuable than a used text book?
- What is the value of an insurance policy?
- What is the value of an undergraduate degree? A graduate degree?
- What is the value of a new car vs. a less expensive used car?
If you decided that a graduate degree is valuable, can you point out how it will pay for itself at some point? If so how long will it take? Is there another investment you could make with that money which would be better? Let’s say you want to be a doctor and you feel your salary will be enough to pay back your loans and then live more comfortably than you otherwise would be able to. Fine, then don’t stress about the loans you take out. Now let’s say you want to be a software programmer. Can you calculate the value getting a graduate degree will have vs. getting extra time working in your field? That may not be so easy but as I say, it’s up to you but look at it through a financial investment lens.
A car is a bit more complex than spending money on college. You’ll find no shortage of people to tell you how purchasing a used car is smarter than buying a new car due to the fact that new cars depreciate. But if that used car breaks down a lot and you get fired from your job for being late, which was more valuable, the new car with the warranty and no mechanical problems or the cheaper car with the hidden defect?
What’s even more complicating is that the “personal” in “personal finance” means that emotions do play a part in our valuation of things. You’ll find no shortage of people who will tell you the sweetest smell in the world is “new car smell”. Are you going to graduate from college work hard and live your entire life driving somebody else’s fishy-smelling cast-off? In your valuation of things you also should consider emotional value. In reality most of us lean towards that anyway which is why marketers exist. What I am trying to get you to do is to consider a financial valuation of things rather than just emotional because that will help you make better and less stressful decisions.
My girlfriend attached an emotional value to that handbag, I attached a financial value to it and that is why it had different values to us. I suppose my girlfriend will someday have the $1,200 handbag. I’ll have to give it a smell when she does and see if it smells like a new car.
PS. Free things that can make you money are really valuable, like this code for 15 points at www.ScholarshipPoints.com. Enter GOODVALUE to get your 15 points.
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This was funny yet filled with good information
May 15th, 2008 | #
I’m thrifty. Used car, no designer clothes. The main thing is to live within your means.
May 15th, 2008 | #
Great info
May 15th, 2008 | #
GOODVALUE
May 15th, 2008 | #
I belive that the time and money one spends with studing is the greatest real treasure one can aquire in life, everything else can be taken from but not the winsdom of knowing the truth.
May 15th, 2008 | #
I belive that the time and money one spends with studing is the greatest real treasure one can aquire in life, everything else con be taken from but not the winsdom of knowing the truth.l
May 15th, 2008 | #
She needs to go to college to get a good job then possibly go and buy the bag, but not when she cant afford it!
May 15th, 2008 | #
I agree live within your means..I buy used text books for school it’s all the same information that is in the pricier new ones!
May 15th, 2008 | #
I would never consider paying that for any bag.
May 15th, 2008 | #
very humourous
May 15th, 2008 | #
Interesting. I have a daughter that is a handbag addict
May 15th, 2008 | #
Great information. Thanks! GOODVALUE
May 15th, 2008 | #
yeehaw
May 15th, 2008 | #
i think that she should go to college and then when she graduates and will be able to get a good job with a great salary and then she will be able to buy as many fancy expensive handbags she wants.
May 15th, 2008 | #
not bad
May 15th, 2008 | #
My girlfriend already graduated from college by the way. She is an architect!
May 15th, 2008 | #
It makes a lot of sense and many people should follw it, it would save a lot more money.
May 15th, 2008 | #
The years spend at college mean nothing if you have not applied yourself and made getting the best education top on your list. But also understanding that life happens and we can not control every situation. If life gets in the way, you have to have the will power to start back where you left off.
May 15th, 2008 | #
I like expensive bags too, but still good info
May 15th, 2008 | #
great info but i like expensive bags too sometimes
May 15th, 2008 | #
nice
May 15th, 2008 | #
Sadly enough, I love those designer handbags too…
May 15th, 2008 | #
my parents have to read this
May 15th, 2008 | #
.
May 15th, 2008 | #
I think this is a great article that more Americans should read.
May 15th, 2008 | #
cool
May 15th, 2008 | #
This comment is typical for college students. My mom is always telling me the same thing.
May 15th, 2008 | #
It will save time and I want my parents to read it!!!!
May 16th, 2008 | #
IN EVERY GOD ,SO I WILL PRAY TO GOD FOR UNDERSTANDING,AFTER I WILL TALK TO GOD IN PRAYER ABOUT HOW TO GO BY IT.AND TALK MY PARENTS ABOUT IT.I WILL ALLOW MY PARENT TO READ IT TO HELP ME OUT
May 16th, 2008 | #
cool
May 16th, 2008 | #
Don’t care if the bag is expensive or not, as long as it look good.
May 16th, 2008 | #
GOODVALUE
May 16th, 2008 | #
yes, what one wears does not confer values on the person but its the individual that confer values to what he wears, eg, if prince charles wears a particular cloth, the value of that cloth goes high because its prince charles that wore it,thats why celebrities are used for adverts.
May 16th, 2008 | #
Trinh, do things look good because they are expensive and therefore must be good? Turn it around, if you see a bag at TJ Maxx for $5.99 that looks good would you purchase it and carry it as proudly as a far more expensive bag? If not then price conveys value to you and this advice might be good for you to consider.
May 16th, 2008 | #
nice
May 16th, 2008 | #
Monetary value does not always determine the real value,there are more important criteria smart people will consider.We should not be deceived,all that glitters is not gold.
May 16th, 2008 | #
GOD BLESS YOU ALL AND HAVE A BLESSED AND PROSPEROUS WEEK.
May 16th, 2008 | #
getting free money is not easy; God bless America…
May 16th, 2008 | #
I have many friends who describe your friend lol
May 16th, 2008 | #
I have many friends that describe your friend.
May 16th, 2008 | #
Thank you and Godspeed.
May 16th, 2008 | #
GOOD INFO
May 17th, 2008 | #
good info. thanks alot
May 17th, 2008 | #
hahah
May 17th, 2008 | #
GOD BLESS YOU OF YOU
May 17th, 2008 | #
Good info.
May 17th, 2008 | #
THIS IS AN EXCELLENT ARTICLE, I WOULD HAVE MY GIRLFRIEND READ IT TOO.
May 17th, 2008 | #
cool
May 18th, 2008 | #
this is information needed to know and ill have everyone read this!!
May 18th, 2008 | #
very interesting
May 18th, 2008 | #
WOW, i learned a lot.
May 18th, 2008 | #
THIS IS AN EXELLENT ARTICLE
May 18th, 2008 | #
I understand how you feel. I still don’t understand why people spend hundreds of dollars on things that they do not need.
May 18th, 2008 | #
its very nice helpful for students.
May 18th, 2008 | #
Very funny but had alot of good information.Live within your means!
May 18th, 2008 | #
It is important to spend you money wisely, especially in this day and time
May 19th, 2008 | #
very helpful!
May 19th, 2008 | #
That article was very interesting. I’m going to share this information with a friend
May 19th, 2008 | #
thanks for the financial perspective
May 19th, 2008 | #
Thanks!!! This was very helpful
May 19th, 2008 | #
alot of good information
May 19th, 2008 | #
I think the value of something is what you make of it
May 19th, 2008 | #
Very helpfull information..Thanks
May 19th, 2008 | #
Helpful and interesting!
May 19th, 2008 | #
I can totally relate…
Thanks for the input …
May 20th, 2008 | #
Very interesting, and a new insight on college value.
May 20th, 2008 | #
Very insightful!
May 20th, 2008 | #
My husband shared this with me…wonder why…probably because I love designer items, I have several of those fancy expensive handbags & shoes (I might add) that I (according to your article) attach emotional value to and he on the other hand attaches financial value….to him a $60 handbag is as good as my $400 handbag…don’t think so…but anyhow….interesting article… ( ;
May 20th, 2008 | #
The value of anything is in each one of our own views. I can’t value an expensive purse but I can appreciate an electronic item such as T.V. Because we each have a personal level of satisfaction, it is not the dollar value of anything but what it takes to make us happy.
To me the value of all of the education system public and private is very worthy of our time. However there are those who don’t see public/private as an equal or a new/old car the same. Remember that it doesn’t matter – for with either we can achieve our Goals and get from one place to the next.
May 20th, 2008 | #
interesting
May 21st, 2008 | #
Great Information, people should learn live their real life,
don’t live other peoples life.if you want to live a rich folk life, when you are not rich, you get into real mess.
Thank you
May 21st, 2008 | #
hey people didn’t you know it yourselves?
May 21st, 2008 | #
You need to dump your girlfriend. Guarantee she wants a $1200 purse, but your birthday she’ll get you $150 watch.
Bet on it.
May 21st, 2008 | #
I always shop around for everything. I always get used books if i can too. Things are very expensive today.
May 21st, 2008 | #
you are perfectly right, I wish all gredy people will read this.
May 21st, 2008 | #
Good article.
May 21st, 2008 | #
Education is the most valuble thing in life not an expensive handbag because sooner or later they get old to its owner and thrown away, nor clothing because they go out of style, nor car because they stop sooner or later but an education because it is a previlege that many in this world does not have. Your educational background is what your surrounding looks for which will get you a career and open doors in your life not the clothes or purse you wear or the car you drive nor the house you live in. It is all about the mind and felling it up with knowledge. When taking classes try hard harder then you have ever tried in your life because you are blessed to beable to do such a thing and the wornderful outcome will take you on a magic carpet ride if you wish.
May 21st, 2008 | #
THIS WAS SOO ME AND SO TRUE GOOD ARTICLE
May 21st, 2008 | #
This was an awesome article! i think its so true today that we all try to live outside our means. As far as the college expenses what I think really matters is what that person wants from their college education and experience. If a university is what a person wants as experience then all means more power to ya! In life there are two things that no one can take away from you, education and experiences.
May 22nd, 2008 | #
great articleee
May 22nd, 2008 | #
interesting. I never thought about it like that.
May 22nd, 2008 | #
Good information….
May 23rd, 2008 | #
GOOD VALUE
May 23rd, 2008 | #
good info
May 23rd, 2008 | #
I love this article! It’s exactly what I’m always thinking because I’m not so materialistic. I always try to think of how valuable something is going to be in the long run and if it will be worth it, even though I have to fight my female instincts of spending money when it is not necessary, being in college definitely makes it easier. You just have to make choices that are going to benefit you.
May 24th, 2008 | #
She can’t afford it, maybe when she completes school she can afford it!
May 25th, 2008 | #
I was doing that.. then I had to sell everything I owned to get enough money to go halp way across the US to go door-to-door selling to try and make enough money to go to school this year
May 25th, 2008 | #
This was really intersting, I enjoyed reading. I think this will help me out.
May 26th, 2008 | #
There’s another way to look at this. Sure the handbag is expensive, but you get what you pay for. Quality counts for something. My mom has expensive handbags, but she has used them for as long as I can remember. What’s better, to buy numerous bags over 10 years, or to invest in one good bag, and have it last you for 10 years?
May 26th, 2008 | #
this is really how things are these days everyone is so materialistic and would rather have a nice car than a good education.really we should think what education is all about weather going to something like itt tech is best for criminal justice or if we should go to get it at a actual college. its the same material so which cost the best so we don’t have to pay for it till we are 40 yrs old
May 27th, 2008 | #
I think that the blog makes a lot of sence and has good information in it.
May 27th, 2008 | #
useful
May 27th, 2008 | #
this is great info.
God bless
May 28th, 2008 | #
wow kool info planning ones finance from college stands the test of time when sense counts.myself, living within potential is more valuable than living within means yet i ll rather not risk my financial status on what ever is not worth the spending.
May 28th, 2008 | #
May 28th, 2008 | #
May 29th, 2008 | #
This passage was very insightful. It has actually caused me to consider rethinking going to my college of choice which is roughly….32,000 annually. Even though I’m entering the extensive culinary field, will I really be able to pay off all my loans and live comfortably? Maybe I am attaching an emotional value to this particular school and not a financial value. But in reality who can honestly afford to go to school, I’ll have to take out loans either way, so I might as well get the best for my money. As for your girlfriend, purchasing a 1,200 dollar purse to carry around maybe 20 bucks and some lipgloss is a little rediculous!
May 29th, 2008 | #
May 29th, 2008 | #
the good things in life should be free,but wisely gotten
May 30th, 2008 | #
lots of helpful information, thanks
May 31st, 2008 | #
money’s always been a problem for me, but I’m a firm believer that it wont be in the future. Sometimes we have to sacrifice in order to make it, and this blog taught me that.
June 1st, 2008 | #
This blog was very helpful! Thanks!
June 1st, 2008 | #
money money money. we just need to learn to manage on things that matter and things that matter the least. college or handbag?lol i really liked this article
June 1st, 2008 | #
Good info!
June 2nd, 2008 | #
true true. you need to question everything you need to put money into
June 2nd, 2008 | #
wants and needs. sometimes it’s hard to tell the difference between a want and a need but in this case it’s very clear. if you can’t afford it then you don’t need it.
June 3rd, 2008 | #
I totally agree with this guy. You can find many interest that fits a woman whether if its expensive or cheap. But it is up to the woman to decide the best value for her. If it was me i would take a cheap cause and still have money in my pocket to pay my student loans off.
June 4th, 2008 | #
I define my existence by what makes me happy. Even though I’m a BROKE college kid, if that hand bag made me ridiculously happy, I’d find a way to buy that beast. If that’s what makes your girl happy she should go for it! To each her own
June 4th, 2008 | #
That was extremely hilarious and useful at the same time: all i have to say is that at least she realizes that school is going to be the ticket to getting that 1200$ handbag that she may not easily afford right now.
June 5th, 2008 | #
i think that this article was very helful
June 6th, 2008 | #
great article
June 6th, 2008 | #
an extremely useful article
June 6th, 2008 | #
They gave great information in a great understandable way.
June 7th, 2008 | #
God bless
June 7th, 2008 | #
very useful
June 7th, 2008 | #
I no the feeling of being broke and wanting a handbag i cant afford. i made sure i got it tho. you can always pay off later right?!
June 8th, 2008 | #
I know a college degree is my ticket to a better future and my salary with a degree is going to be much more than what I would make without. So degree means bucks
June 9th, 2008 | #
Que intersante. AyAyAy!!!!!!!!!!!!!!!!!!!!
June 9th, 2008 | #
Great articule. Really helps you to look at the big picture.
June 10th, 2008 | #
wOW THAT IS VERY INTERESTING
June 11th, 2008 | #
Everyday I make money choices, on what to spend for the littest things. This sit reminded me of my sister where she will buy whatever no matter the price. Where I would be like um no thanks I got more important things to buy like school. So I thought this was a really helpful and reinsuring piece!
June 11th, 2008 | #
Gud info. This is one of the many infomation an idividual needs to know to be financially free.
June 11th, 2008 | #
Very Interesting
June 11th, 2008 | #
Wow…this is great information, especially for a college student like me wholoveds shoes, and a lot of times has to decide whether or not to buy the shoes or buy food. I definitely will be buying food from now on. Thanks!!!!!!
June 11th, 2008 | #
WOW
June 11th, 2008 | #
hmmm kind of makes me want to be responsible with the graduation money i recieved. But at the same time I NEVER splurge. I think certain times it is ok to treat yourself, as long as you are responsible. In my case I am taking the rest of the money after I purchase a Playstation 3 and put it in savings. It’s responsibly splurgin I guess you could say.
June 11th, 2008 | #
Good Info.
June 12th, 2008 | #
This if very helpful info to know.
June 12th, 2008 | #
this gave me something to think about. great info and it brought me a new perspective when shopping.
June 12th, 2008 | #
interestin.
June 12th, 2008 | #
Very informative and helpful
June 12th, 2008 | #
this article was very informative and is surely useful…thanks for posting it
June 12th, 2008 | #
I am a handbag addict but the way I see it, you need to stay within your means and not go over the top or you will get hurt in the long run
June 13th, 2008 | #
…..Learned something…..
June 13th, 2008 | #
Interesting article. Thanks
June 13th, 2008 | #
I can relate to this blog because I “love” coach purses. However, if I see the same purse at Target, I would buy that one because of the cheaper price. I am more about the design of the bag, and whether I like the outward appearance, and if it would be useful for me. (not the price)…I am this way about all purchases.
June 13th, 2008 | #
This article is funny. My sister is the same way. She love luxurious handbags.
June 13th, 2008 | #
Its the astetics. People are drawn to the newer, over priced item(s) rather then cheaper used items. A good example: If you put a new $50,000 car next to the same car of the same year, make, model, and with a slightly duller paint finish, but priced at $15,000, most people would look at the $50k first. Though it is a hard concept to grasp, its something we all learn eventually.
June 14th, 2008 | #
Its totally true what others have submitted, but one must also take into account the volition one carries with onesself.
June 17th, 2008 | #
Great information! Thanks
June 17th, 2008 | #
I would never buy something that has has the purpose of holding money and in which costs more than the money I could afford to carry around in it! I know a lot of females buy handbags on a regular basis and I just don’t understand why?? They use them for a month or so, give it away, and are out buying another. I would much rather spend this money on a vacation that would have everlasting memories.
June 17th, 2008 | #
Good info…I let my bf buy me the exspensive handbags!!
June 21st, 2008 | #
INFORMATIVE
June 22nd, 2008 | #
I think you have a very good point. It was a good way to explain the message you are trying to convey. I have a fetish for shoes and when I look at the designer brands I always want them but know since I am in college my money can be good else where!
June 22nd, 2008 | #
interesting. It’s crazy that the actual price of something is the exact value that something ISN’T. I mean, the store puts that price on it because they figure the bag is worth less than that and a good deal for them. The customer who actually buys it, considers the bag more valuable than the price. Others of us don’t consider it that valuable and so, will never buy it. Hmm. Interesting.
June 26th, 2008 | #
wE ARE ALL THE SAME BUT YET SOO DIFFERENT IN THE WAY WE BEHAVE/INTERESTING ARTICLE
June 27th, 2008 | #
spending my hard earned money on things that i can get cheaper and do just the same as the expensive. foolish.
July 1st, 2008 | #
I’m glad my girlfriend likes the K-Mart brand!
July 2nd, 2008 | #
if only money really grew on trees
July 3rd, 2008 | #
dollar store lol
July 3rd, 2008 | #
wow.. good info! thanks!
July 8th, 2008 | #
I still say $1200 for a handbag, no way! Not worth it to me.
July 9th, 2008 | #
There is this problem with value. Air is one of the most valuable things but it is free. The most expensive car in the world may not necesserily have all you want but you gain fame. We attach value to things not actually that things have value. If Shakira wears a pant worth 2 dollars, her fans wont mind paying 2000dollars to get.
July 16th, 2008 | #
I love handbags too but my parents have taught me that I don’t Have to Have every bag see. I love getting them as gifts.
July 16th, 2008 | #
I’m not into materialistic things so this doesn’t appeal to me.
July 18th, 2008 | #
I don’t buy expensive handbags. There are many things that money would be better spent on.
July 19th, 2008 | #
i loved this article…i am the type of girl to go shopping based on what i feel in clothes as opposed to if its pricy…by this i mean that my clothes are top-notch yet still under 30 dollar dresses (new) and even got guys who wear armani think i shop at bebe or higher.
July 20th, 2008 | #
Why does college have to cost money
July 20th, 2008 | #
Impulse buying and emotional purchases (like some guys) are a quick fix that have a short life. Go for the ones that last!
July 21st, 2008 | #
goodvalue
July 22nd, 2008 | #
I watch my pennies I’m trying to get my mother to watch hers. I tell her all the time.
Good insight.
July 23rd, 2008 | #
This really helps
August 3rd, 2008 | #
I’m one of those people that would spend money on an expensive hand bag because I love them oh so much, but I’m also the type of girl who loves the clearance rack at stores. I won’t pay full price for something if I know I can get it cheaper somewhere else. I’m some what of a fanatic about it haha. Evrey time I snag great deals, it puts a smile on my face and I come home telling my mom of my adventures. I will say that I was stupid and traded in my old car for a new one and now have a car payment; but you live and you learn and I’ll never get a new car ever again if I can’t pay for cash for it. Plato’s Closet is one of the greatest stores alive!!!! I can get my $60 and up BKE jeans (that are sold at Buckle) for $18-$22 at this store. Brand names for the fraction of the price. And so what if they’ve been worn by other people. I just tell myself it’s like wearing your best friend’s clothes. I have no shame in saving money. I’m 22 and I’m an old soul. My mom has me hooked on Dave Ramsey and I listen to Clark Howard on my way home from work everyday. haha. I love saving money and using coupons and whatever other free deals I can get my hands on.
August 7th, 2008 | #
Guys know best sometimes lol
August 7th, 2008 | #
Great info. Thanks!
August 7th, 2008 | #
GOODVALUE
August 14th, 2008 | #
Good info
August 16th, 2008 | #
I am def. the cheapest person anyone would ever meet.
August 27th, 2008 | #
good info- funny but very true- definitely a good value!!
August 28th, 2008 | #
GOOD INFORMARTION
March 29th, 2009 | #