“If you choose to spend a dollar today, you are actively choosing not to have four dollars, or six, or even eight later”

Brett Arends calculates that an iPad would really cost him $2000.

That’s how much that $500 would yield in a retirement account if he invested it instead of spending it on a new Apple product.

He says that’s how he thinks about every potential purchase these days:

Yes, I typically do these mental calculations, at least in the back of my mind, for most things. A "$50" lunch at Morton's really costs $200. A "$5,000" trip to Bali: $20,000. And so on. It tends to cut down on the spending.

. . .

If you choose to spend a dollar today, you are actively choosing not to have four dollars, or six, or even eight later.

For someone age 40, each dollar you spend is actually costing you about $4. Even if you're in your mid-50s, each dollar you spend is actually taking about $2 out of your retirement fund.

And for somebody age 20, for whom the money can grow for at least 45 years, each dollar is actually costing you nine.

This is a fantastic article.

But I’m still getting my iPad.