The Value of Your Purchase

Sorry for not writing last week, but this entry has been frustrating to write.  I've mostly done it to myself: I had an idea to present, but realized that it had no purpose or value.  So I molded the idea a bit to attempt to present something worthwhile, but it still wasn't coming to me.  Finally, I've arrived at a conclusion for this post and it's much simpler than my original idea.

Suppose, for example's sake, that you are sitting in your room on Friday night at 5pm and have no idea what you want to do that night.  Your tendency will be to go to your fall-back activity, like reading, watching TV, or playing video games.  Sometimes that's sufficient, but sometimes you wanna do something else.  However, in our cash-strapped economy, it can be hard for us to feel OK spending a little more money to do something else.  Whether it's your fall-back activity or something new, there's usually a monetary value tied to it.  Different realms of activity present different costs, so how do we compare one from the other?  It's simple: cost per hour.

Take the cost of whatever your activity of choice is and simply divide it by the number of hours you think you will spend (or the number of hours you have spent, if you're looking at something you've already done) to find the cost per hour.  Using this value, you can get a gauge of the monetary value you're extracting from the activity.  For instance, the average movie in the theater is roughly 2 hours long.  The average price of a ticket these days is probably around $10; thus, a movie costs $5/hr.  Again, nice and simple.

So what does this number mean?  Really, it means what you want it to mean.  It always depends on how much value you put on the activity; for instance, how much fun you think you'll have (or have already had) with the purchase.  If you're sitting in your room on Friday night and trying to decide between a few activities, the cost per hour is a great place to start, to give yourself a base numeric value for each activity.  You can use this base value in combination with your perception of the "value" of the activity to figure out which activity you think will be most "worth it".

I feel blessed when I can look back on some of my purchases and find that I got incredible value out of them.  For instance, the Popcap game Plants v. Zombies is a popular tower defense game available on almost every system imaginable, including phones.  I paid $2.50 on Steam (a game organization service, for those who are unaware) for the game and ended up spending roughly 45 hours on it (with perhaps more to come).  I enjoyed those hours I spent too, as I have always enjoyed the mild strategy of tower defense games.  It makes me feel better to think about Plants v. Zombies from the cost per hour perspective: $2.50 at 45 hours is roughly $0.05/hr.  Let's be real here: there aren't a lot of things that'll keep you entertained at $0.05/hr, for 45 hours.

There's a zombie on your lawn.

You can also use these values to make yourself a more conscious spender.  I purchased Assassin's Creed: Revelations for roughly $30 last year on Black Friday.  I enjoyed the previous Assassin's games and felt that Revelations was a sure bet.  I was wrong: the game was too thick, attempting to incorporate too many activities and becoming a slow, monotonous experience.  I played that game for maybe a total of 5 hours before I traded it in.  That means that AC: Revelations was about $6/hr.  Still not a terrible number, but nowhere near as valuable as the $0.05/hr presented by Plants v. Zombies.  Now, Assassin's Creed 3 is releasing very soon and though it looks like an even surer bet than Revelations, I will do my research online before I purchase it, remembering my previous failed purchase.

Fail, Ezio.  Fail.

Let me remind you once again that this number, the cost per hour, is up to your own interpretation.  If you really enjoyed a certain movie, then $5/hr was well worth it.  If you purchased a book for $2.50 but couldn't read it for more than 30 minutes, then the roughly $5/hr you spent there seems like a failed purchase.

In conclusion, a number like cost per hour could be useless but within your interpretation could be very useful as well.  Calculating numbers like the cost per hour will, at the very least, slow you down and make you think through your purchases a little more carefully.  That's why, among other reasons, people keep budgets.

I hope this was helpful to you and I will try to write again this week to make up for missing last week.  Enjoy your day!