We’ve all turned on the TV at some point in our lives and seen a rich person living ostentatiously. Perhaps it was a report on a celebrity, or maybe it was one of those shows where a rich person shows off his or her home. Whatever it was, you probably felt struck by the excess of it all. Living the high life is incredibly expensive!
Your feelings were right, to an extent. Big mansions and giant yachts don’t come cheap, and many of them are completely out of reach to most normal people. But it’s also true that the conspicuous consumption that is seen on entertainment news shows and high-life lifestyle programming is not the only way to enjoy the finer things in life – in fact, it’s not even the typical way! Athletes and musicians newly flush with cash don’t always make the most intelligent purchases, so don’t follow their model. Instead, choose to live your own version of the high life – on a budget.
Substance versus status
When you think about purchasing a luxury item, think of the decision as having two parts: substance and status.
Substance means the tangible things about the product – how it’s useful, and what it actually does for you. Status is about the vibe the product has, and what it means to people who see it.
If a manufacturer makes a sports car that can go from 0 to 60 miles per hour in less than three seconds, has luxurious and comfortable seats, and is full of premium features like navigation systems and a high-end speakers, that’s substance. Sure, you probably won’t actually ever need to go from 0 to 60 that fast, but when we talk about luxury items we have to use the word “useful” a little loosely. The car can actually go from 0 to 60 in less than three seconds – it’s a physical ability of the car – so let’s call that substance.
So what would be status? Let’s say the manufacturer made thousands of these cars, but then made three “special editions” with a little logo on them but without much else changing. Those special editions would have essentially the same substance as the rest of the cars, but they’d have much more in the “status” department. They’d be snapped up by elite collectors who care about such things, and they’d likely cost hundreds of thousands more than the rest of the line.
So if you bought the sports car and a rich rock star bought the special edition, you’d have essentially the same car – the same substance – but the rich rock star would have some more of the status (and he would also be a lot less rich than he was before he bought the car).
Choose substance over status
Status is a vain pursuit, and it’s also not very cost-effective. A status-obsessed person will always need the newest, nicest, rarest thing. Imagine a rich person buys a sporty boat from the dealer, parks it at his dock, and drops dead of a heart attack before he ever puts the key in it again. The boat is “used,” but not really – it’s been put in the water, and that’s it. Would you buy this boat at a huge discount, if you could afford it?
Of course you would! But a status-obsessed rich person might not, because it would not be truly “new” – and there would be no impressive story to tell about walking into the dealership and writing a massive check.
So this is the secret to living well on a budget: look at the substance, not the status.
Substance-minded people who want to have fun on the lake may choose to buy boats without some of the useless frills. They may choose to buy used boats that still pack a punch. What they won’t do is turn down an opportunity like the one in our hypothetical.
Do you enjoy gambling? Great! You can gamble as often as the richest high roller, if you’re smart about choosing your stakes and where you gamble. Online casinos offer all the same games as the most expensive Las Vegas brick-and-mortars, and you can use them without paying for hotels and dinners and a new tuxedo.
How often and how much you apply this rule is up to you, of course. Maybe status is sometimes important to you, or maybe you don’t need luxury in every aspect of your life. But when you do want to live the high life, look for ways to do it for less by focusing on the “true” value – the substance – of what you’re getting.
After all, who cares about looking rich when you can feel rich?