Would you spend 800% more for a product or service in order to gain a 10-15% improvement to your level of comfort or convenience?
The truth for most people is that they would think nothing of this sort of behaviour. It happens all the time.
In fact, it’s one of the biggest reasons people find themselves stuck financially. We live in a culture that has become programmed to spend exponentially more money on products and services in order to make minor improvements to luxury or convenience.
If we look at this in reverse, one of the most effective ways to transform your financial situation is by sacrificing some of that convenience in order to save significant amounts of money.
To illustrate, I’ll use a favourite past time of millions of North Americans, myself included….camping!
Allow me to detail a typical scene of our family arriving at a campground. We pull in with our 2005 Toyota Sienna, towing our late 90’s vintage pop up tent trailer. The five of us hop out and spring into action…well, my wife and I spring into action that is. Our kids are usually quick to grab their bikes and take off, exploring the park.
All of this is ok to my wife, as she prefers having space to work and not be tripping over people. Until everything is put together, she is a woman on a mission.
Once the tent trailer is disconnected and levelled, we crank up the top shell and pull out the beds at either end. My wife works from inside and begins organizing things that were transported in our van, while I make the exterior connections, propane, electricity, water etc.
It takes about 30 minutes and a small amount of elbow grease and we’re good to go.
Kings of Convenience
The tenants in the adjoining campsite have just arrived. Their camping arrangement is a tad more premium than that of the Mystery Money family.
A shiny, black GMC Sierra is backing in with a travel trailer that must be about 30 feet long. Both truck and camper look as though they’re no more than a couple years old. Camping doesn’t get much more luxurious.
The RV has two large slide outs, and without a doubt comes equipped with comforts such as air conditioning, a big screen TV and a bathroom w/ shower. Heck, it may even have granite countertops.
We’ve clearly got some big spenders as neighbours!
Across the park we’re a clear minority in our tent trailer. There are a few others scattered around. There’s even the odd brave soul who dared to camp in a (gasp), tent!
But overwhelmingly, the campground is filled with newer pick-ups towing large 5th wheels or travel trailers equipped with all of the modern conveniences of home.
Now, let’s take a look at the cost difference between the Mystery Money and “Big Spender” camping set ups:
Mystery Money Family
2005 Toyota Sienna $6700.00 (cash purchase in 2013)
1998 Dutchmen Tent Trailer $2000.00 (cash purchase in 2012)
Total cost of equipment $8700.00
Big Spender Family
Almost New Pick Up $45,000.00 (approximate cost to purchase new)
Almost new Travel Trailer 25,000.00 (approximate cost of a new 28-32 ft. RV)
Total cost $70,000.00
There’s a high likelihood that the Big Spender family has financed the truck and the camper. This would add thousands of dollars of interest costs, but for this illustration I’m only using an average purchase price for the sake of comparison.
Let’s see how much more expensive the Big Spender’s approach to camping is than mine:
$70,000 / $8,700 = 804%
In this scenario, the ‘new truck and ridiculously luxurious trailer’ camping experience cost over 800% more than my Mystery Money family van and used tent trailer adventure.
That’s a HUGE difference. For someone to be willing to spend that much more money to camp at the same campground, they must be gaining an incredible amount of comfort and convenience!
Not quite. I would estimate that my campsite neighbours enjoy 10-15% of added convenience for all of their additional expense.
What are the advantages to their trailer vs. mine?
To me the obvious one is that it’s easier to prepare prior to a camping trip. A trailer built with hard walls allows you to leave it set up when you get home, and store supplies in advance of leaving, without the hassle of setting up or tearing down.
The other added convenience is that you are more comfortable in poor weather. It easier to spend a rainy afternoon in a large camper than a pop-up.
But tent trailers have some distinct benefits as well. They typically sleep more people, with many sleeping up to 7 comfortably. A lot of travel trailers can only sleep 4 or 5.
Also, by uncovering the large screened walls of the camper, you have plenty of airflow throughout, which is very nice on a humid afternoon or night. It also helps you feel as though you’re more a part of the outdoors.
Here’s the thing. When people are camping, they are outside 90% of the time. They really only go inside the camper to sleep, and perhaps to prepare food.
Also, the restrooms and showers in many campgrounds in this day and age are so spacious and modern that even campers with fancy trailers choose to use the campsites facilities.
In many cases, the pick up truck was purchased solely for the purpose of towing the camper 5 or 10 times per year. Meanwhile, my minivan is my family vehicle, and has the advantage of having much lower operating costs year round.
It’s no secret that I’m not a fan of pick up trucks. If you want to read more about what a terrible investment they are, feel free to read my earlier post, titled Your Pickup Truck Is Driving You To The Poorhouse.
My campsite neighbours are paying over 800% more money to enjoy a camping experience that might be 10-15% more luxurious than mine.
I’d love to hear from readers on this one. What things have you spent extra on in order to be more comfortable. What does the cost vs. added comfort ratio look like?