The PlayStation Hunt: A Case Study in Consumerism

Some of my favorite memories from my previous church involve the game nights we used to have. At the time, I was pretty terrible at first-person shooters but managed to learn enough to get into the games and play decently, which helped to make things fun. By far the coolest game “night” was the 10 hours of Halo we all played for my best friend’s bachelor party.

I’ve been rocking the Playstation 3 now for about 4 years, and by “rocking”, I mean playing a few games here and there. Currently I own just one game, Black Ops 2. With Black Ops 4 coming out in August and roommates who enjoy Call of Duty WWII, I’ve started imagining buying a PS4 and bringing the old game nights back.

There’s just one problem: I’m a cheap-ass.

Here’s the deal. A new 500gb PS4 costs $270. Buying used or refurbished only saves you about $10. I prefer the white model, but this is less common and usually costs slightly more. Now, the 1tb PS4 Pro, in white, is available for $400. I can get it new and shiny and up-to-date, and that is the temptation. But I’m also not a big gamer, so it seems absurd to spend so much money on something that will likely play a very small roll in my life.

Here are some factors:

  • Whether I’m paying $270 or $400, the console will only be used for 2-4 games at most because there isn’t much I care to play. This boils down to a high cost-per-use
  • I’m assuming that I can actually get people over here for a game night
  • The PS4 isn’t really for me. It’s for community, for other people. If I’ve been fine with the PS3 for so long, why am I getting picky trying to “go big” on a console I’m really only buying for other people?
  • If there is one thing I want to change about my life right now, it is my weight and my physical fitness. The last thing I need are games to convince me to sit on my butt. And game nights usually come with copious amounts of pizza and soda. This can be great on rare occasions, but is this really what I want on a consistent basis?

I’m probably going to wait this one out for awhile. I’m tempted to “treat” myself because I “deserve it” and “have the money”, but those are all dumb reasons, though they may be emotionally appealing.

Here are some alternate solutions if I really want to do game nights:

  • There are two PS3s in this house, so a big game night here requires one more copy of Black Ops 2 and that is it. Even more realistically, there are enough controllers for me to have three friends over.
  • Many friends have PS4s. If I really want to host, I could ask them to bring theirs over.
  • I could ask my friends to host (ok, not likely, but you never know until you ask)
  • Game nights are fun, but so is hiking and watching movies

It’s possible I may still buy one someday, but I think I will be waiting for a really good deal first. Or maybe I will cave in? Yes, I’m always behind on video games, but who cares? Right now, I’d rather use the money to visit my sister and her family, or take a Hebrew class, or trip around Colorado (one of my all-time favorite trips cost me ~$350). I just can’t justify the current prices knowing how little I will use it and how low of a priority video games are for me. It is also worth noting that it will still cost me an extra $60 to play online and additional money for games as well as additional controllers. Video game consoles typically have very high extended costs.

The Unpopularity of Financial Independence

I don’t have any friends who are interested in financial independence. A few friends have encountered Mr. Money Mustache’s blog through the course of their financial searches, but I don’t know anybody else personally who is pursuing FI.

Largely, I don’t think anybody knows it is an option. I certainly didn’t. I once had the off thought that it might be possible to earn my income through investments, but the sheer size of the required money intimidated me, and I basically gave it up as unrealistic. Now I know it is very realistic.

Just yesterday some friends at church (good people, I might add), were laughing at how a friend had gotten a high-paying engineering job in the midwest, rented a 2-bedroom 2-bath apartment for $500-600/month, and was putting 35% of their earnings into retirement, with an employer match of 10%. In speaking about this person, one friend laughed and said, “Does he want to get married anytime soon?” All I could think of was how his friend could do even better if he downsized to a 1-bedroom 1-bath apartment and invested even more!

My first paycheck came in today with the changes I made for health insurance, which saves me a decent amount of money. This inspired me to put 2% in my roth 401k on top of the 30% I’m putting in the traditional 401k. You know, tax diversification.

It’s very popular if you are in your 20s to travel, and it kind of kills me thinking how fast I could save up for travel if I weren’t contributing all this, but the power of compounding is real, and I know I will thank myself later. I have left just enough money in my take-home pay to afford my standard budget and still have some left over for the car, for travel / personal development, and cash for giving or investing outside of the retirement accounts. But if I really want to hit my goals, pushing myself to 35% would be ideal. I am planning on getting creative with rent so I could boost this higher, since it is fairly low compared to most others in the FI community. Living alone is a luxury that probably costs me around $600/month. I should write it like that in the budget. Rent is what I would expect to pay if I split a place. That extra $600 should just be a budget item called “personal luxury”. Ouch! That’s a dose of reality I need!

A co-worker once asked me what my plans were for marriage, kind of as a joke in response to my story of pursuing FI. Average women want a large house with all the accoutrements, new cars, etc. They want to see your status. See, though, I want to BE my status, free to pursue what really matters to me in life. Now, when you hang around churches a lot you find more women who want to do missions work and aren’t as concerned about having things. To be fair, I had a really long conversation about all of this with a (rather attractive) girl who received it well a few months ago, but I think most people in the church are still gunning for that middle class life of consumption, as long as the family can dutifully give 10% to the church, of course. It is what is. I’d honestly rather be single than spend my life chasing the American dream. The best you can hope to do with excess possessions is share them, and that’s probably the only smart way to approach that dream: to not over-consume, but to do things like open your house up to others, to make food for them, etc. But that really is a huge can of worms I can’t cover in one post. In all reality though, almost everybody I know will choose “lots of stuff, just shared” as an out for giving up things in general. Honestly, I’m just going to have to let go of this. It seems rather dumb on my part to worry about other people’s decisions.

It’s not popular but it’s definitely my cup of tea. My copy of Jacob Fisker’s “Early Retirement Extreme” arrived today and it’s chock full of great philosophy. I want to volunteer full time overseas, to make those small differences in the world, to experience new cultures, and to be able to do it all without a timeframe stamped on it. That’s what FI means to me. It may not be popular, but I think when my friends see that in action they may think, “Hey, you know maybe that’s wasn’t such a bad option, afterall.” Unfortunately, it may be rather late in their game, so I keep discussing the subject. Let’s make this more popular!

The Pernicious Lie

“It will always be tough.”

Several years ago, I experienced a significant pay raise at my job and found that my money was melting away and I wasn’t sure where to. I was living with my parents to avoid paying rent and was using a large part of my paycheck to pay off my student loans, but I began to question why I wasn’t making faster progress despite the pay increases.

“You know, it will always be tough,” my mom told me.

Now, to be clear, I’m not saying my mom is trying to spread pernicious lies. But I am trying to say that my mom’s reaction that day is characteristic of a broader social problem, this belief that life is so difficult and there is never enough money. I have read articles about families making $200,000 per year and complaining that “it’s just so hard to make it.” A cursory look at their expenses basically revealed that people are not naturally intelligent creatures.

Scarcity is an old and neglected economic term. One major and influential economic theory states that human desires are infinite while resources are finite, thus producing scarcity. In a scarce environment, supply and demand rule, and thus is born the market economy. The whole Occupy movement was created to protest the lack of capital among the “99%”, blaming this on misconduct by the “1%” who have hoarded capital (I’m not going to take a position on this here). We see this in political movements, but we all see this in personal finance contexts, where people lament just “how hard it is to get by” and how “you just can’t support a family on $X per year”.

A common theme, something I discovered within myself that day, was no matter how much one earns, the money never seems to be enough. But how was it that at lower pay, I had everything I needed, and at higher pay, I still had everything I needed but didn’t know what had actually happened to the difference?

We all know I was spending that extra money. It’s not rocket science. We humans have this amazing proclivity to increase our expenditures when we increase our income. We have more money, so we spend more money. After all, human desires are infinite. I can sit down at any time and make a list of things I would like to own if I either had the money or money weren’t a factor.

Now, I have read that wages have not increased with the cost of living. Especially here in Denver, I’d say most of people’s expenses are being dumped into overpriced houses and overpriced apartments, and many jobs do not earn enough money to cover these expenses and most other necessities. And that sucks. But I also want to explore this more.

The market is not your friend. Technology tells you how much it can improve your life and increase your creative juices, and help you to make money from your own innovation. Car companies tell you to treat yourself to the new car smell and gain prestige for the good hard work that you do. Cereal companies tell you that you are a good mother for feeding your kids a nutritious breakfast. Insurance companies tell you how secure you will feel knowing your money or health is protected. The problem is that we believe this. Because of scarcity, because of supply and demand, everyone wants your money. And you’ve been raised to spend that money on the products those people are selling. You go to work and depend on your company to sell things so that you continue to have a job so that you can continue spending. We all know this cycle. It’s not good, and it’s not evil. You could potentially extrapolate this message from the “labor” Adam is forced to perform in Genesis. Nonetheless, we spend because we believe it will make us happier, that it will satisfy x or y desire or “need.” This becomes ingrained in our understand of what “base subsistence” even means. Dave Ramsey has a great story about how, when he was going bankrupt, he absolutely refused to give up his Jaguar until the choice stopped being his. “But I need this!” we all say. “How can I live without this?”

I also want to approach one major objection to Financial Independence. People love to criticize it when they have kids. “Haha, yeah, I’d like to see you live like that once you have kids!” Clearly, kids cost millions of dollars, despite the fact that humans have successfully raised them for hundreds of thousands of years before the market economy existed.

When I was a child, I really wanted these flip-head Power Ranger action figures. You pressed the belt and the head flipped from mask to no-mask. I thought it was super cool. But my parents refused to buy me any for the longest time. Do you know what I did? I had these large Power Ranger marbles that stood-in for the action figures, took on personalities and went on adventures all the same. I wouldn’t have even cared if I hadn’t known the action figures existed (demonstration-effect theory, anyone?). Those marbles probably cost a few bucks compared to much more for even just one action figure. Spoiler: I did eventually receive one for my birthday, if I remember correctly.

I’ve always been fascinating when reading ethnographies to learn that many indigenous children grow up making mud or baked cow-manure figures to play out social roles they see around them. Cost $0 USD??? It sounded like they were happy. I guess you’d probably get a call from social services if you baked some cow patties and your neighbors saw your kids out playing with them, but while I’m joking I’m also not, and that’s just a reflection that society is not a perfect representation of reality, and cultural norms can be flawed. What you can derive from this is that your kids don’t need expensive masses of toys to be happy. We’ve shuffled them into an immaculate toy world where everything is about toys. It’s just sad.

Also for the record, toys are only one category of overspending on children, but I’m beginning to suspect I could fill a whole post with more. “You don’t have kids, you can’t talk!” No, but I’ve seen what parents and family members buy for kids and it’s proof that people can be idiots in their rush to give those kids a perfect consumerist childhood.

Going back to the pernicious lie, you also see people buying new $30,000 vehicles in order avoid a major $1500 vehicle repair and a day or two getting rides to and from work. Many believe car payments are essential to life. People nearing bankruptcy refuse to cancel their satellite TV service to save money. Having an iPhone is considered essential living “because of my fine taste.” I’m starting to feel negative so I’ll cut this off here, but this is a small sample of what happens.

We just are not very smart. We are so not smart that I’m planning to write about the sorts of not-smart things I have done with money.

Several months ago I was putting 12% of each paycheck into my 401k, and the stretch to 15% made me question if I could hit my other savings goals. Then I moved it to 20% and found out that I was fine and had plenty left over. So in January I will be taking the plunge and giving 30% a shot. It’s amazing how stupid I was being before, how much floating money I was leaving outside of any budget bucket, “just in case”. My goals is 50%. Currently I could reach 40%, but this would wipe out the money I plan to put monthly into my car maintenance savings and the money I would like to save for things like travel and visiting friends across the country. Most of it will be saved, but won’t be invested, per se. The easiest way to reach 50% is to get creative with living situations or find an apartment that costs less than my current (this is somewhat difficult in Denver).

Lest we feel too negative over the “it will always be difficult” maxim, there is another maxim that is also popular: “live below your means.” Many people do not like this because it forces you to assume responsibility for your actions. Yes, there is injustice. Yes, there are difficulties. Yes, some people have extreme circumstances. I hate feeling like I have to qualify everything all the time, but people hate you if you don’t. If you’re helpless, then ignore me. If you are in any control of your life, challenge yourself to live below your means. Build a budget. Understand where your money goes and why. Do you shop to feel better? Do you believe that car payments are a good thing? Are you paying people to do things you can do yourself? Do you use the things you have purchased in the past? Have you ever had buyer’s remorse? If so, how can you avoid that in the future?

If it feels I’m leaving this post incomplete, I am. I think I can really dig into more specifics by detailing my experiences and what I’ve seen other do. This applies to both good and bad.

The pernicious lie does not have to apply to you.



Who are the Joneses?

I had never actually heard of the Joneses until I began reading Dave Ramsey nearly a decade ago, and I have mostly only heard the expression “keep up with the Joneses” in financial settings. My family has never, to my knowledge, purchased anything to keep up with their neighbors or friends. I could be wrong, but if they did it certainly wasn’t anything like a boat or ATVs – you know, anything large and expensive.

When I first read about the Joneses, I felt pretty smug about myself. I certainly didn’t have any problem like that. In fact, to this day, I’m not certain any of my friends have been Joneses, and, to my shame, I can’t actually say I know my neighbors in this apartment building.

But then I had to ask myself: who actually are the Joneses?

I’ve decided the Joneses are anybody who have something that I don’t have. What I mean by this is that anybody who has something I don’t have can, intentionally or unintentionally, influence my decision to purchase said item.

And here’s what often isn’t mentioned about the Joneses: sometimes they actually can afford the swag they buy. The great danger is assuming they can’t and writing yourself off as a smart cookie while you criticize their lack of financial discipline, but this simply may not be true. The Joneses are who we perceive them to be. They could be your friend who bought an iPhone X, or a neighbor who bought a ten-year-old Maxima¬† which looks so much nicer than your rusting twenty-year-old Accord. They could be your friends who always invite you to join them at expensive restaurants. They can even be your parents who decided a sleep number bed would help them get better sleep. Or they could be an acquaintance who has a massive gun collection. Whatever.

There’s no point calling out the Joneses – the Joneses are in your head. They are the status and the utility that you crave. They are either the things you covet or the things you feel pressured to buy.

Despite the highly inflated housing market here in Denver, many friends have bought-in, and I often feel the current¬† whispering to me, “You should buy in, too!” My financial disagreements with homeownership, and my desire to leave within the next 3 to 5 years don’t make this a tempting prospect, but I can say that I definitely feel the pressure. I also wonder what sort of message I send to my friends when I try to persuade them to join me at various restaurants, a great weakness of mine.

If you want to make smarter decisions than keeping up with the Joneses, you have to understand your desires for what they are. Are you trying to be accepted? To fit in? Are you trying to present yourself in a certain light (“I’m an extreme off-roader!”, “I’m a Mac guy!”, “I’m a nature lover!”, “I do humanitarian work!”)? You have to understand whether that’s something you truly want or if you aren’t just kidding yourself and trying to fill-in your insecurities. When you are happy with yourself, you won’t strive so hard to keep up with who you think you want to be.