Every individual faces two basic spending choices; they can either buy goods and services, or invest the money in stocks and other long term securities. Barring purchases of necessary goods, using money to buy frivolous and/or luxury items might provide satisfaction in the short run, but in the long run, the utility derived from these purchases is actually be negligible. No matter how small the expenditure, an investment of a same amount will always give more returns.
Assume that you did not spend money on luxury products, instead invested it in the stocks of a company or in Bitcoin when it was trading at a lower price? Or what about when other cryptocurrencies like Dogecoin (if you have one, and would like to cash it out now, you might want to look at https://www.coin.cloud/blog/how-to-cash-out-dogecoin) had just stepped into the market? Have you wondered what your investment would be worth now? The investment time machine looks at how stocks have grown over time – to view the investment time machine infographic click here.
If you hadn’t spent on gadgets:
In case of Apple, the price of a Macintosh classic in 1990 was $1,500. In today’s money, the price of this product would be $2,635. However, if you hadn’t bought the Macintosh and had invested your money in Apple stock, you would have had $98,606 today. And if the reality of having this amount of money in your pocket doesn’t make you want to Apple aktie kaufen oder verkaufen, (buy or sell Apple stock) at some point in the future, then nothing will. It’s quite extraordinary. Similarly, not buying the iphone in 2007 for $599 and buying company stock instead would have given you $2,116 now, when the value of the product today would have been $664.
However, the real shock comes when you realize that if you hadn’t spent $5,700 dollars in 1997 to buy an Apple Powerbook and bought stock in its place, you would have had $524,345 today. The present value of a Powerbook? $8,153.
The story is similar for Microsoft as well. Buying Windows 2.0 in 1986 would have set you back by a $100. Buying the product today will cost you $209. However, investment of $100 in Microsoft stock will give you $11,480 today. Similarly, Windows 95 cost $200 then, and costs $301 now. Value of that money if you had bought stock instead? $1,263.
If you had not spent on fast/processed food:
Buying a month’s worth of Coca-Cola for a family of five in 1964 would have cost $8.10. Today it will cost $59.95. However, if you had bought stock, instead of the drink, you would have had $1,015 today.
Four Big-Mac burgers in 1970 cost $2.20. Spending that money on McDonald’s stock will give you $1,116 today. Present value of four Big-Macs? $13.
If you had not spent on toys:
When the Barbie doll was first launched in 1984, it cost $20. Investing in Mattel stock, instead of buying the plastic doll, would have given you $981 today. Value of the Barbie in present money is $44.19.
Super Nintendo games were the rage in 1994 with their cutting edge graphics and fast paced action. It cost $250 then and has a present value of $387.34. Investing in stock would have given you $601 today.
If you had not spent on home appliances:
GE brought out a whole new range of refrigerators in 1968. Buying a fridge then would cost you $500 and the present value of a GE fridge is $3297.17. If, however, you had bought $500 of GE stock in 1968, you would have had $47,763 today.
Similarly, buying a Whirlpool washer dryer combo in 1983 would have made you poorer by $467. Investing in their stock, would have made you $5,177 richer today. Present value of the product is $1,076.
If you had not spent on a vacation:
Are you thinking of going on a cruise? If you had gone on a cruise ship in 1989, it would have cost you around $1000. If you had invested that money in Carnival Cruise Line stock and gone camping instead, today you would be $13,521 richer. The price of the product in today’s money? $1757.29.
A stay at the Marriot for a week in the 1980’s would cost you $875. Present value of the same stay is $1397.94.
However, buying Marriot stock then would have given you $7,359 today.
If you had not bought a car
In 1982, buying a Ford Mustang would have catapulted you into instant popularity. All for a sum of $6,572. Investing that money in Ford stock would have given you a whopping $314,433 today. Meanwhile, present value of a Mustang is $15,633.33, paltry in comparison.
Yearly auto insurance premium in 1988 would cost you $350. Today’s value of the same product in $648.26. However, investment in stock gives you $8,863 today.
These are but a few examples of the amount of money you would have had today, if you had cut a few corners in the past. Luxury goods are necessary too; they reassure us that we do live a good life. However, it is important to learn to use your money wisely…spend on luxuries as well as, make good investments. This not only makes your present comfortable, but also, insures your future.