What is the value of a dollar?
And I don’t mean 100 pennies or 20 nickels or four quarters … though a dollar is all of those things. I mean, what is a dollar worth? Maybe you’re like supermodel Linda Evangelista who famously said, We don’t wake up for less than $10,000 a day. And that was in 1990. So in 2019 dollars, or $19,200, a buck is worth, approximately, 1.5 seconds of her time. Assuming eight hours of vigorous sashaying. #goals
For those who don’t work for pay—say, my children—the value of a dollar is more often viewed through the lens of what you can buy with good ol’ George Washington. Let me give you an example. My daughter is nine. She desperately wants an iPhone. On this front, she will taste only tears and disappointment. That said, I have told her that she might get a smartphone at some point in the far-off future if she can 1) show that she is responsible enough to wield such a device, 2) pay for said phone herself and 3) pay for ongoing service, the latter of which, I told her, costs $100 a month. Which is mostly true. I mean, she’d be paying for the entire family, but … details.
I suppose I should’ve been suspicious when she reacted to my terms with excitement. I thought I had just told her she’d basically need about $1,500 to have a smartphone for a year. I mean, that’s a lot of hongbao from her Chinese grandma.
Habitual readers of this blog know how important financial goals are. Hey, sporadic blog readers! They’re really important! My daughter shows you one reason why. They are motivating as heck. A dollar isn’t a dollar anymore to her. It’s basically … 1/1500 of an iPhone. Since then, everything has been evaluated through this value lens … and been found lacking.
She’ll occasionally want to buy something … or go somewhere … or do something … and I’ll tell her I’ll split the cost with her. Or I’ll ask her to pay for it herself. Since, you know, that’s how the rest of us commoners do it. I can almost see the wheels spinning in her head. She’s calculating … and concluding that whatever she wanted, it really wasn’t worth 1/150 of an iPhone.
Never mind, Mom.
My mom once said to me about my daughter, She looks just like you … only prettier. Question—is that supposed to be a compliment? Truth be told, I don’t think we look much alike all all, but sometimes, when she’s thinking … I can see a resemblance. ’Cause what she’s calculating is what I’m calculating! Next Wednesday’s high temperature in these here parts? -8 degrees! Sure, I could grab a latte and scone while running errands, but … is that worth 1/50 of a plane ticket to California?
What do you ascribe great value to? For someone who hasn’t taken her Instant Pot out of its original box, I belong to a lot of Instant Pot groups on facebook. For many people in those groups, their Instant Pot is worth its weight in gold. I know, ’cause they keep saying so. At today’s gold price, assuming you have the 6-quart model (6.6 kg), your beloved Instant Pot is worth … over $272,000. If you think I just used a common idiom as an excuse to do some math … you would be correct.
Where was I? Oh, right. As you’re tracking your spending and calculating cost per use and building all the good financial habits you want to build, it might help to make dollars and cents less abstract. Are you mindlessly plunking down $10 for a forgettable doodad? Or trading away 1/27200 of another Instant Pot?