Every year, without fail, the biggest names in the smartphone world come up with a newer, shinier, more powerful flagship than the last, sending hundreds of thousands of people flocking to the nearest Apple or Samsung store (or their computer, more likely) for a customary annual upgrade.
Think about that for a moment. If you don’t have enough money to survive for three months should you fall on hard times, should you really be splurging on a phone that costs over half a month’s minimum wage at this time?
Every one in five people believes that a new phone is worth going into debt for
However, financial advisers would beg to differ.
$1,000 now could cost you $25,000 thirty years from now
Tim Cook’s analogy is a fallacy
And Tim Cook’s appealing coffee analogy maybe be more misleading than it sounds. It assumes that you spend the average price of $3 per coffee (the non-fancy kind) every day, which many people do.
But of course, homemade coffee is both better and cheaper, and requires very little effort to make. For $16, you can get a bag of beans at Costco which could eke out 41 cups of coffee at thirty-nine cents each, estimates the New York Times. With that in mind, a high-end $1,000 iPhone today will cost you 2,500 cups of coffee, or nearly 7 years of your daily caffeine fix.
And if you charge that iPhone to a credit card, it could turn into a $3,000 investment with the accumulated interest by the time you pay it off—we won’t even try to calculate that in coffee.
We aren’t all in the same boat, however
Needless to say, these numbers and cautionary tales apply to most of us average consumers, who may need to make certain sacrifices—however small they may be—in order to meet our long-term financial goals and priorities. For some it may be real estate, for others travelling and starting a family, and for all of us it includes a retirement fund.
Those who already earn enough to have no concerns over meeting their lifelong financial goals, with secured housing and retirement funds, don’t necessarily need to think twice about making a $1000 annual splurge on a bit of material happiness. Yet that’s a fairly miniscule part of the smartphone consumer market, and it isn’t the case for most of us.
It’s good to have fun, but also to be aware and prioritize
Of course, it’s extremely important to invest in yourself. After all, what are you hustling for day and night, if not to enjoy the fruits of your labor at some point or another?
Most of us already do that, however: be it for the occasional $10 fancy latte, or other constant luxuries (big or small) that we tend to reward ourselves with after a successful day, or comfort ourselves with when we’re down. And if we really think about it, an annual smartphone upgrade for rather miniscule improvements in performance may fall a little on the excess side.
Do you actually get that much benefit from upgrading?
On top of everything, flagship handsets don’t get exponentially better year after year. And as smartphone technology has already reached impressive heights, upgrading from last year’s to this year’s iPhone or Galaxy flagship may yield a smaller return than the price we end up paying or it.
“The 13 is the first one where I’m like, ‘This one literally only has a better camera,’ ” shared Boneparth.
Live in the moment, but prioritize
It’s certainly great to live in the moment, to have fun, and to enjoy the latest of what modern technology has to offer. Yet we also must remember that there will always be something better than what we’ve got, a slightly better camera, slightly larger screen real estate; somewhere the grass will always be a little greener.
And it’s our responsibility to evaluate just how much having those extra few megapixels, or that slightly better screen or processor power, is really worth sacrificing other worthy investments for. Maybe upgrading our smartphone every couple of years or more wouldn’t hurt so much after all.