9-21-03 - 2


I've never met anyone who thinks about money wisely in their daily life. They conserve money foolishly and spend it ridiculously. For example, people consider paying $20 to join our Poker game too much. But is it? You'll play for 4-5 hours, and you do have some chance of winning. For a good player, that actually makes the game free, because you win often enough that your average cost is $0, but the silly people still see it as "costing $20". Even for a bad player, maybe it costs $15. That's $15 for several hours of fun, much cheaper than buying a video game, for example. People will buy cheap products that are a little cheaper, but much lower quality, like poor meat, store brand Macaroni & Cheese, generic tires for their car, etc. All the savings from that add up to like $500/yr and make a big difference in quality of life. On the other hand, they go out a lot and get glasses of wine at restaurants for $7/glass, when you can get a whole bottle for $4 ! Again, that would be fine if you're doing it because you really enjoy the experience, but you do have to realize it's a big cost and that's a huge chunk of your entertainment budget.

Perhaps the biggest mistake people make is spending a lot of time to make very little or save very little. For example, people will spend weeks shopping around trying to find the best price on a TV. In the end they might save $100 because of this. But they spent 10 hours looking at all the different stores! That means they only saved $10/hour, which is good if they're making minimum wage, but if your salary is much more than that, you're wasting time. This becomes especially pointed once your salary is very high. For example, an execute making $100/hour or more should do almost nothing to save money outside of work. All you should do is work or enjoy yourself. You should not mow your own lawn, clip coupons, shop around, etc. (unless you enjoy those things). If you feel up to doing some work to make some money, you should work for your job. At some point you shouldn't even drive yourself to work, you should get a driver and a laptop and work on your commute (again, unless you enjoy the drive).

There's an awesome Smith's song about the death of a pop star, and how the record company releases compilation albums as soon as he dies, and how they have a party and are so glad he's dead -- I think of this as I see all the Johnny Cash albums come out. Damn, I can't remember the name of the song!

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